EXHIBIT 10.1
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated
as of December 29, 2000, by and between Medix Resources, Inc., a Colorado
corporation (the "Company"), and RoyCap Inc., an Ontario corporation (the
"Purchaser").
R E C I T A LS
WHEREAS, the Purchaser desires to purchase a Convertible Note
(the "Convertible Note") of the Company which permits the Company to draw
up to $2,500,000;
WHEREAS, the Purchaser desires to purchase warrants to
purchase up to 1,250,000 shares of Common Stock, $0.001 par value per
share of the Company (the "Warrants"); and
WHEREAS, the Company desires to issue and sell to the
Purchaser, and Purchaser desires to purchase from the Company, the
Warrants and the Convertible Note subject to the terms and conditions set
forth in this Agreement.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants
contained in this Agreement, and for other good and valuable
consideration the receipt and adequacy are hereby acknowledged, the
Company and the Purchaser agree as follows:
1. DEFINITIONS
1.1. Certain Terms. For purposes of this Agreement,
(a) "Business Day" shall mean any day except Saturday, Sunday and any
day which shall be a federal legal holiday or a day on which banking
institutions in the State of Colorado generally are authorized or
required by law or other governmental action to close;
(b) "Closing Date" means the 10th day of January, 2001, or such earlier
or later date as is agreed to in writing by the Company and the
Purchaser, or their respective counsel;
(c) "Closing Bid Price" means the closing bid price for the Common
Stock on the American Stock Exchange or on such subsequent market as the
Common Stock is then listed and if not so listed, as reported by the
National Quotation Bureau Incorporated or similar organization or agency
succeeding to its functions of reporting prices at the close of business
on any particular date;
(d) "Common Stock" means the Company's common stock, $0.001 par value
per share and any other securities into which such stock shall
hereinafter be redistributed or recapitilized;
(e) "Dollars" or "$" means lawful money of the United States of America;
(f) "Effective Date" means the date the Registration Statement has been
declared effective by the U.S. Securities and Exchange Commission, with
respect to all Registerable Securities;
(g) a "Person" means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any kind;
(h) "Registerable Securities" means the Common Stock of the Company to
be issued upon: (i) the conversion, redemption, or exercise of the
option granted to the Purchaser upon the call of the Convertible Note;
(ii) the exercise of the Warrants; or (iii) the payment of interest on
the Convertible Note by way of the issuance of Common Stock.
(i) "Registration Statement" means the registration statement to be
filed with the U.S. Securities and Exchange Commission pursuant to the
Registration Rights Agreement with respect to all Registerable
Securities;
(j) [Intentionally Deleted];
(k) "Transaction Documents" has the meaning ascribed thereto in Section
4.1; and
(l) "Trading Days" has the meaning ascribed thereto in the Convertible
Note
1.2. Knowledge and Belief.
References to the knowledge or belief of the Company mean the
actual knowledge or belief of members of senior management of the Company.
2. SALE AND PURCHASE
2.1. Sale and Purchase. Subject to the terms and conditions hereof, at
the Closing, the Company hereby agrees to issue and sell to the Purchaser
and the Purchaser agrees to purchase from the Company, (i) the
Convertible Note; and (ii) the Warrants. The Warrants shall be purchased
for an aggregate purchase price of One Dollar ($1.00). Advances shall be
made by the Purchaser pursuant to the Convertible Note in accordance with
the provisions hereof and the aggregate advances thereunder shall
constitute the principal indebtedness under the Convertible Note.
2.2. Availment.
On the day of Closing (as hereinafter defined) the Purchaser
shall advance the sum of Seven Hundred and Fifty Thousand Dollars
($750,000) to the Company ("Tranche 1") less all expenses properly
deductible pursuant to the terms hereof. Provided that the Company is in
full compliance with the Transaction Documents at the time, additional
draws may be made by the Company in the amounts and within the time
periods set out below:
(a) Two Hundred and Fifty Thousand Dollars ($250,000) within ten (10)
business days from the Effective Date ("Tranche 2"); and
(b) Five Hundred Thousand Dollars ($500,000) within ten (10) business
days of each of the following:
(i) the 60th day from the Effective Date ("Tranche 3");
(ii) the 90th day from the Effective Date ("Tranche 4"); and
(iii) the 150th day from the Effective Date ("Tranche 5").
Notwithstanding the foregoing, the Purchaser shall not be
under any obligation to make any advance under, Tranche 2, Tranche 3,
Tranche 4 or Tranche 5 unless on each of the five (5) Trading Days ending
the day prior to a request for an advance by the Company the Closing Bid
Price exceeds One Dollar ($1.00).
2.3. Conditions to Subsequent Advances.
The obligations of the Purchaser to advance Tranche 2,
Tranche 3, Tranche 4 and Tranche 5 (collectively, the "Subsequent
Tranches") shall terminate on October 31, 2001. In addition to the
requirement that the Company be in compliance with all Transaction
Documents, the Purchaser shall be under no obligation to advance any of
the Subsequent Tranches in the event:
(a) there is a material adverse change in the business operations,
properties, prospects or financial conditions of the Company not publicly
reported since the most recent drawdown;
(b) any statute, rule, regulation, executive order, decree, ruling or
injunction has been issued or is in effect which restricts, prohibits or
materially adversely affects the consummation of the transactions
contemplated hereby, including the exercise of any of the Warrants or the
conversion of the Convertible Note; or
(c) any material litigation or proceeding potentially adverse in any
material respect is commenced against the Company or any of the
Subsidiaries, as defined below, and remains pending, including any
investigation by a governmental authority which seeks to restrain,
prevent or materially change the transactions contemplated hereby, or
seeking damages in connection therewith.
3. CLOSING, DELIVERY AND PAYMENT
3.1. Closing. The closing (the "Closing") of the sale and purchase of
the Convertible Note, the Warrants (collectively called the "Securities")
shall take place on the date hereof at the offices of Fogler Xxxxxxxx
LLP, or at such other place and at such other time as the Company and
Purchaser may mutually agree (such date is hereinafter referred to as the
"Closing Date").
3.2. Delivery; Payment. At the Closing, subject to the terms and
conditions hereof, the Company will deliver to the Purchaser (i) the
Convertible Note in the form attached hereto as Exhibit A, (ii) the
Warrant Agreement in the form attached hereto as Exhibit B, and (iii) the
Warrant to acquire up to 500,000 Common Stock substantially in the form
attached hereto as Exhibit C, to be purchased at the Closing by the
Purchaser, against payment of the sum of Seven Hundred and Fifty Thousand
Dollars ($750,000) therefor by wire transfer made payable to the order of
the Company or as it shall direct, subject to a deduction for fees
incurred by the Purchaser as set out in Section 7.1 hereof. The Company
shall also execute and deliver the executed Registration Rights Agreement
and such other closing documents set out in Section 6.1 hereof, including
an opinion of counsel to the Company, and such other closing documents as
counsel to the Purchaser reasonably requests.
4. REPRESENTATIONS AND WARRANTIES
4.1. Representations and Warranties of the Company. The Company hereby
makes the following representations and warranties to the Purchaser:
(a) Organization and Qualification. The Company is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Colorado with the requisite corporate power and authority to own
and use its properties and assets and to carry on its business as
currently conducted. The Company has no subsidiaries other than National
Care Resources - New York, Inc., National Care Resources-Colorado, Inc.,
National Care Resources-Texas, Inc., TherAmerica Inc. and Cymedix Lynx
Corporation, JJ Care Resources, Inc. (the "Subsidiaries"). The
Subsidiaries are entities, duly organized, validly existing and in good
standing under the laws of their respective states of incorporation, with
the requisite corporate power and authority to own and use its properties
and assets and to carry on their business as currently conducted. Each
of the Company and the Subsidiaries are duly qualified to do business and
is in good standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or property
owned by them makes such qualification necessary, except where the
failure to be so qualified or in good standing, as the case may be, could
not, individually or in the aggregate, (x) adversely affect the legality,
validity or enforceability of the Securities or any of this Agreement,
the Warrant Agreement or the Registration Rights Agreement (collectively,
the "Transaction Documents"), (y) have or result in a material adverse
effect on the results of operations, assets, or condition (financial or
otherwise) of the Company and the Subsidiaries, taken as a whole, or (z)
adversely impair the Company's ability to perform fully on a timely basis
its obligations under any of the Transaction Documents (any of (x), (y)
or (z), a "Material Adverse Effect").
(b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and to consummate the
transactions contemplated by each of the Transaction Documents and
otherwise to carry out its obligations thereunder. The execution and
delivery of each of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated thereby have been
duly authorized by all necessary corporate action on the part of the
Company and no further action is required by the Company. Each of the
Transaction Documents has been duly executed by the Company and, when
delivered (or filed, as the case may be) in accordance with the terms
hereof, will constitute the valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as
such enforcement may be limited by bankruptcy, insolvency, moratorium or
similar law affecting creditors' rights generally, or by general
principles of equity. Neither the Company nor any Subsidiaries are in
violation of any of the provisions of its respective certificate of
incorporation or by-laws.
(c) Capitalization. The Company's authorized capital stock consists of
100,000,000 shares of Common Stock, 488 shares of 1996 Convertible
Preferred Stock, 300 shares of 1997 Convertible Preferred Stock, 300
shares of 1999 Series A Convertible Preferred Stock, 2000 shares of 1999
Series B Convertible Preferred Stock, and 2,000 shares of 1999 Series C
Convertible Preferred Stock, of which 1 share of 1996 Convertible
Preferred Stock, 50 Shares of 1999 Series B Convertible Preferred Stock,
425 shares of 1999 Series C Convertible Preferred Stock and 46,317,022
shares of Common Stock are issued and outstanding as of December 15,
2000. There are 22,078,143 shares of Common Stock underlying the
Company's outstanding options and warrants as of December 15, 2000. The
Company owns all of the capital stock of the Subsidiaries. No securities
of the Company or the Subsidiaries are entitled to preemptive or similar
rights, nor is any holder of securities of the Company or the
Subsidiaries entitled to preemptive or similar rights arising out of any
agreement or understanding with the Company or the Subsidiaries by virtue
of any of the Transaction Documents. The SEC Reports accurately reflect
the Company's outstanding warrants and options in all material respects.
To the knowledge of the Company, except as specifically disclosed in the
SEC Reports or Schedule 4.1(q), no Person or group of related Persons
beneficially owns (as determined pursuant to Rule 13d-3 promulgated under
the Securities Exchange Act of 1934, as amended (the "Exchange Act")), or
has the right to acquire by agreement with or by obligation binding upon
the Company, beneficial ownership of in excess of 5% of the Common Stock.
(d) Issuance of the Securities. The Securities are duly authorized
and, when issued and paid for in accordance with the terms hereof, will
be validly issued, fully paid and nonassessable, free and clear of all
liens, encumbrances and rights of first refusal of any kind
(collectively, "Liens"). The Company has reserved 3,333,333 shares of
Common Stock for issuance hereunder upon conversion of the Convertible
Note and 1,250,000 Common Stock upon exercise of the Warrants. The shares
of Common Stock issuable upon conversion of the Convertible Note, payment
of interest thereon and upon exercise of the Warrants, are referred to
herein as the "Underlying Common Stock."
(e) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company
of the transactions contemplated thereby do not and will not (i) conflict
with or violate any provision of the Company's or the Subsidiaries'
certificate of incorporation or bylaws (each as amended through the date
hereof), or (ii) subject to obtaining the Required Approvals (as defined
below), conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration or cancellation
(with or without notice, lapse of time or both) of, any agreement, credit
facility, debt or other instrument (evidencing a Company or Subsidiaries
debt or otherwise) or other understanding to which the Company or the
Subsidiaries are a party or by which any property or asset of the Company
or the Subsidiaries are bound or affected, or (iii) result in a violation
of any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which the
Company or the Subsidiaries are subject (including federal and state
securities laws and regulations), or by which any property or asset of
the Company or the Subsidiaries are bound or affected; except, in the
case of each of clauses (ii) and (iii), as could not, individually or in
the aggregate, have or result in a Material Adverse Effect. To the
Company's knowledge, the business of the Company is not being conducted in
violation of any law, ordinance or regulation of any governmental
authority, except for violations which, individually or in the aggregate,
could not have or result in a Material Adverse Effect.
(f) Filings, Consents and Approvals. Neither the Company nor the
Subsidiaries are required to obtain any consent, waiver, authorization or
order of, give any notice to, or make any filing or registration with,
any court or other federal, state, local or other governmental authority
or other Person in connection with the execution, delivery and
performance by the Company of the Transaction Documents, other than (i)
the filings required pursuant to Section 5.10, (ii) the filing with the
Securities and Exchange Commission (the "Commission") of one or more
registration statements meeting the requirements set forth in the
Registration Rights Agreement and covering the resale of the Underlying
Common Stock by the Purchaser (the "Underlying Shares Registration
Statement"), (iii) the application(s), if any, to the American Stock
Exchange ("ASE") for the listing of the Underlying Common Stock (and with
other national securities exchange or market on which the Common Stock
are then listed), in the time and manner required thereby, (iv)
applicable Blue Sky filings, and (v) in all other cases where the failure
to obtain such consent, waiver, authorization or order, or to give such
notice or make such filing or registration could not have or result in,
individually or in the aggregate, a Material Adverse Effect (the items
described in clauses (i)-(v) are collectively, the "Required Approvals").
(g) Litigation; Proceedings. There is no action, suit, notice of
violation, proceeding or investigation pending or, to the knowledge of
the Company, threatened against or affecting the Company or the
Subsidiaries or any of their respective properties before or by any
court, governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) which (i) adversely affects or
challenges the legality, validity or enforceability of any of the
Transaction Documents or the Securities or (ii) could, individually or in
the aggregate, have or result in a Material Adverse Effect, except as
disclosed in SEC Reports.
(h) No Default or Violation. Neither the Company nor any of the
Subsidiaries (i) is in default under or in violation of (and no event has
occurred which has not been waived which, with notice or lapse of time or
both, would result in a default by the Company or the Subsidiaries
under), nor has the Company or the Subsidiaries received notice of a
claim that it is in default under or that it is in violation of, any
indenture, loan or credit agreement or any other agreement or instrument
to which it is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is in
violation of any order of any court, arbitrator or governmental body, or
(iii) is in violation of any statute, rule or regulation of any
governmental authority, except in the case of any above event as could
not individually or in the aggregate, have or result in a Material
Adverse Effect.
(i) Exemption from Registration. Assuming the accuracy of the
representations and warranties of the Purchaser set forth in Sections
4.2(b)-(g), the offer, issuance and sale of the Convertible Note and the
Warrants to the Purchaser as contemplated hereby are exempt from the
registration requirements of the Securities Act of 1933, as amended (the
"Securities Act").
(j) SEC Reports; Financial Statements. The Company has filed all
reports required to be filed by it under the Securities Act and the
Exchange Act for the lesser of one year preceding the date hereof or
since the date its reporting obligations arose (the foregoing materials
being collectively referred to herein as the "SEC Reports" and, together
with the Schedules to this Agreement, the "Disclosure Materials") on a
timely basis. As of their respective dates, the SEC Reports complied in
all material respects with the requirements of the Securities Act and the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder, and none of the SEC Reports, when filed, 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. All material agreements to which the Company is a party or to
which the property or assets of the Company are subject (other than this
Agreement and the other Transaction Documents which will be filed as
Exhibits to the Underlying Shares Registration Statement) have been filed
as exhibits to the SEC Reports. The financial statements of the Company
included in the SEC Reports comply in all material respects with
applicable accounting requirements and the rules and regulations of the
Commission with respect thereto as in effect at the time of filing. Such
financial statements have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis during the
periods involved ("GAAP"), except as may be otherwise specified in such
financial statements or the notes thereto, and fairly present in all
material respects the financial position of the Company and its
consolidated subsidiaries as of and for the dates thereof and the results
of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit
adjustments. Except as specifically disclosed in the SEC Reports, (a)
there has been no event, occurrence or development that has or that could
reasonably be expected to result in a Material Adverse Effect, (b) the
Company has not incurred any liabilities (contingent or otherwise) other
than (x) liabilities incurred in the ordinary course of business
consistent with past practice and (y) liabilities not required to be
reflected in the Company's financial statements pursuant to GAAP or
required to be disclosed in filings made with the Commission, (c) the
Company has not altered its method of accounting in any material respect
or the accounting firm serving as its financial auditors and (d) the
Company has not declared or made any payment or distribution of cash or
other property to its stockholders or officers or directors (other than
in compliance with existing Company stock or stock option plans and
existing agreements and terms of employment) with respect to its capital
stock, or purchased, redeemed (or made any agreements to purchase or
redeem) any shares of its capital stock.
(k) Investment Company. The Company is not, and is not an Affiliate
(as defined in Rule 405 under the Securities Act) of, an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended.
(l) Certain Fees. Except for fees paid to Xxxx Xxxxx and/or American
Capital Consultants, Ltd., or any affiliate thereof, or as otherwise
disclosed by the Company to the Purchaser, no fees or commissions will be
payable by the Company to any broker, financial advisor or consultant,
finder, placement agent, investment banker, bank or other person, with
respect to the transactions contemplated by this Agreement.
(m) Form S-3 Eligibility. The Company is eligible to register the
Underlying Common Stock for resale under Form S-3 promulgated under the
Securities Act.
(n) Listing and Maintenance Requirements. The Company has not, in the
one year preceding the date hereof received notice (written or oral) from
the ASE or any other stock exchange, market or trading facility on which
the Common Stock is or has been listed (or on which it has been quoted)
to the effect that the Company is not in compliance with the listing or
maintenance requirements of such exchange, market or trading facility.
The Company is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with all such listing
and maintenance requirements.
(o) Patents and Trademarks. The Company and the Subsidiaries have, or
have rights to use, all patents, patent applications, trademarks,
trademark applications, service marks, trade names, copyrights, licenses
and rights (collectively, the "Intellectual Property Rights") which the
Company believes are necessary or material for use in connection with
their respective businesses as described in the SEC Reports and as
currently conducted, and the failure to have which could reasonably be
expected to have a Material Adverse Effect. Neither the Company nor the
Subsidiaries have received a written notice that any of the Intellectual
Property Rights used by the Company or the Subsidiaries violates or
infringes upon the rights of any Person. To the knowledge of the Company,
all such Intellectual Property Rights are enforceable and there is no
existing infringement by another Person of any of the Intellectual
Property Rights.
(p) Regulatory Permits. The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct
their respective businesses as described in the SEC Reports, except where
the failure to possess such permits could not, individually or in the
aggregate, have or result in a Material Adverse Effect ("Material
Permits"), and neither the Company nor the Subsidiaries have received any
notice of proceedings relating to the revocation or modification of any
Material Permit.
(q) Title. Neither the Company nor the Subsidiaries own any real
property. Except as set forth in Schedule 4.1(q), the Company and the
Subsidiaries have good and marketable title to all personal property
owned by them which is material to the business of the Company and the
Subsidiaries, in each case free and clear of all Liens, except for Liens
that do not materially affect the value of such property and do not
materially interfere with the use of such property by the Company or the
Subsidiaries. Any real property and facilities held under lease by the
Company and the Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
materially interfere with the use of such property and buildings by the
Company and the Subsidiaries.
(r) Disclosure. This Agreement, including the Schedules to this
Agreement, are true and correct and do not contain any untrue statement
of a material fact or omit to state any 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.
4.2. Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to the Company as follows:
(a) Organization; Authority. The Purchaser is an entity duly
organized, validly existing and in good standing under the laws of the
Province of Ontario, Canada and have the requisite corporate power and
authority to enter into and to consummate the transactions contemplated
by the Transaction Documents and otherwise to carry out its obligations
thereunder. The purchase of the Securities hereunder has been duly
authorized by all necessary action on the part of the Purchaser. Each of
this Agreement and the Registration Rights Agreement has been duly
executed, and when delivered by the Purchaser in accordance with the
terms hereof, will constitute the valid and legally binding obligation of
the Purchaser, enforceable against it in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
moratorium or similar law affecting creditors' rights generally, or by
general principles of equity.
(b) Investment Intent. The Purchaser is acquiring the Securities and
the Underlying Common Stock as principal for its own account for
investment purposes only and not with a view to or for distributing or
reselling the Securities or any part thereof. It has no present
intention of selling or granting any participation in, or otherwise
distributing the Securities. It is not party to any agreement or
arrangement with any person to distribute any of the Securities.
(c) Purchaser Status. At the time the Purchaser was offered the
Securities, it was, and at the date hereof it is, and on the date it
acquires the Underlying Common Stock it will be an "Accredited Investor"
as defined in Rule 501(a) under the Securities Act. The Purchaser has
not been formed solely for the purpose of acquiring the Securities.
(d) Experience of such Purchaser. The Purchaser, either alone or
together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of
evaluating the merits and risks of the prospective investment in the
Securities, and has so evaluated the merits and risks of such investment.
(e) Ability of such Purchaser to Bear Risk of Investment. The
Purchaser is able to bear the economic risk of an investment in the
Securities and, at the present time, is able to afford a complete loss of
such investment.
(f) Access to Information. The Purchaser acknowledges that it has
reviewed the Disclosure Materials and has been afforded (i) the
opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Company concerning the terms
and conditions of the offering of the Securities and the merits and risks
of investing in the Securities; (ii) access to information about the
Company and the Company's financial condition, results of operations,
business, properties, management and prospects sufficient to enable it to
evaluate its investment; and (iii) the opportunity to obtain such
additional information which the Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed
investment decision with respect to the investment. Neither such
inquiries nor any other investigation conducted by or on behalf of the
Purchaser or its representatives or counsel shall modify, amend or affect
the Purchaser's right to rely on the truth, accuracy and completeness of
the Disclosure Materials and the Company's representations and warranties
contained in the Transaction Documents.
(g) General Solicitation. The Purchaser is not purchasing the
Securities or the Underlying Common Stock as a result of or subsequent to
any advertisement, article, notice or other communication regarding the
Securities or the Underlying Common Stock published in any newspaper,
magazine, website or similar media or broadcast over television or radio
or presented at any seminar or any other general solicitation or general
advertisement.
(h) Reliance. The Purchaser understands and acknowledges that (i) the
Convertible Note, the Warrants and the Underlying Common Stock are being
offered and sold to it without registration under the Securities Act in a
private placement that is exempt from the registration provisions of the
Securities Act and (ii) the availability of such exemption, depends in
part on, and the Company will rely upon the accuracy and truthfulness of,
the foregoing representations of the Purchaser and the Purchaser hereby
consents to such reliance.
(i) Certain Fees. The Purchaser has not engaged or contracted with,
and owes no fees or commissions to, any broker, financial advisor or
consultant, finder, placement agent, investment banker, bank or other
person, with respect to the transactions contemplated by this Agreement.
(j) Confidentiality. The Purchaser acknowledges that it may receive
material non-public information in connection with its acquisition of the
Securities and the Underlying Common Stock, and that it will keep such
information confidential and shall treat such information with the same
standard of care as it would its own most proprietary and confidential
business information, and further the Purchaser agrees not to use such
information to trade or act as a "tipper" in connection with the
Company's publicly traded securities. However , the Company and the
Purchaser agree that in connection with the execution of this Agreement,
all material information provided to the Purchaser has been publicly
disclosed information.
5. ADDITIONAL AGREEMENTS
5.1. No Other Representations.
The Company acknowledges and agrees that the Purchaser does
not make or has not made any representations or warranties with respect
to the transactions contemplated hereby other than those specifically set
forth in Section 4.2.
5.2. Transfer Restrictions.
(a) The Securities and the Underlying Common Stock may only be disposed
of pursuant to an effective registration statement under the Securities
Act, to the Company or pursuant to an available exemption from or in a
transaction not subject to the registration requirements of the
Securities Act, and in compliance with any applicable federal, state and
provincial securities laws. In connection with any transfer of Securities
and the Underlying Common Stock other than pursuant to an effective
registration statement or to the Company, except as otherwise set forth
herein, the Company may require the transferor thereof to provide to the
Company an opinion of counsel selected by the transferor and reasonably
acceptable to the Company, the form and substance of which opinion shall
be reasonably satisfactory to the Company, to the effect that such
transfer does not require registration under the Securities Act.
Notwithstanding the foregoing, the Company, without requiring a legal
opinion as described in the immediately preceding sentence, hereby
consents to and agrees to register on the books of the Company and with
any transfer agent for the securities of the Company any transfer of
Securities by the Purchaser to an Affiliate of the Purchaser or to one or
more funds or managed accounts under common management with the
Purchaser, and any transfer among any such Affiliates or one or more
funds or managed accounts, provided (i) that the transferee certifies to
the Company that it is an "accredited investor" within the meaning of
Rule 501(a) under the Securities Act, (ii) that it is acquiring the
Securities solely for investment purposes (subject to the qualifications
hereof), and (iii) that any such transferee shall agree in writing to be
bound by the terms of this Agreement and any such transferee shall have
the rights and obligations of the Purchaser under this Agreement and the
Registration Rights Agreement. Except as set forth in the preceding
sentence, the Convertible Note shall not be transferred without the
consent of the Company, which consent shall not be unreasonably withheld.
(b) The Purchaser understands and agrees that the certificates for the
Underlying Common Stock shall bear the following legend, or a similar
legend to the same effect, until (i) such Underlying Common Stock shall
have been registered under the Securities Act and the Underlying Common
Stock effectively shall have been disposed of in accordance with a
registration statement that has been declared effective; or (ii) in the
opinion of counsel for the Company such Underlying Common Stock may be
sold without registration under the Securities Act or any applicable
"Blue Sky" or state securities laws:
NEITHER THESE SECURITIES NOR THE SECURITIES INTO
WHICH THESE SECURITIES ARE [CONVERTIBLE]
[EXERCISABLE] HAVE BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE OR PROVINCE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN
A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE OR PROVINCIAL
SECURITIES LAWS.
The Company may not make any notation on its records or give instructions
to any transfer agent of the Company which enlarge the restrictions of
transfer set forth in this Section. The Purchaser will comply with the
prospectus delivery requirements of the Securities Act as applicable to
it in connection with sales of Registerable Securities (as defined in the
Registration Rights Agreement) pursuant to an Underlying Shares
Registration Statement.
5.3. Acknowledgment of Dilution. The Company acknowledges that the
issuance of the Underlying Common Stock will result in dilution of the
outstanding shares of Common Stock, which dilution may be substantial
under certain market conditions. The Company further acknowledges that
its obligation to issue Underlying Common Stock is unconditional and
absolute, subject to the limitations set forth herein and in the
Convertible Note, the Warrant Agreement and the Warrants regardless of
the effect of any such dilution.
5.4. Furnishing of Information. As long as the Purchaser owns any
Securities, the Company covenants to file timely (or obtain extensions in
respect thereof and file within the applicable extension period) all
reports required to be filed by the Company after the date hereof
pursuant to the Exchange Act. So long as the Purchaser owns any
Securities, if the Company is not required to file reports pursuant to
such laws, it will prepare and furnish to the Purchaser and make publicly
available in accordance with Rule 144(c) promulgated under the Securities
Act such information as is required for the Purchaser to sell the
Securities under Rule 144 promulgated under the Securities Act. The
Company further covenants that it will take such further action as any
holder of Securities may reasonably request, all to the extent required
from time to time to enable such Person to sell Underlying Common Stock
without registration under the Securities Act within the limitation of
the exemptions provided by Rule 144 promulgated under the Securities Act,
including the legal opinion referenced above in this Section. Upon the
request of any such Person, the Company shall deliver to such Person a
written certification of a duly authorized officer as to whether it has
complied with such requirements.
5.5. Integration. The Company shall not, and shall use its best efforts
to ensure that, no Affiliate shall, sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as
defined in Section 3 of the Securities Act) that would be integrated with
the offer or sale of the Securities in a manner that would require the
registration under the Securities Act of the sale of the Convertible Note
and the Warrants to the Purchaser.
5.6. Increase in Authorized Shares. If on any date the Company would
be, if a notice of conversion or exercise (as the case may be) were to be
delivered on such date, precluded from issuing the number of Underlying
Common Stock as would then be issuable upon a conversion, redemption or
call in full of the Convertible Note, the payment of interest thereon and
the exercise in full of the Warrants (the "Required Minimum") due to the
unavailability of a sufficient number of authorized but unissued or
reserved Common Stock, then the Board of Directors of the Company shall
promptly (and in any case, within sixty (60) Business Days from such
date) prepare and mail to the stockholders of the Company proxy materials
requesting authorization to amend the Company's certificate of
incorporation to increase the number of shares of Common Stock which the
Company is authorized to issue to at least such number of shares as is
reasonably adequate to enable the Company to comply with its issuance,
conversion, exercise and reservation of shares obligations as set forth
in this Agreement, the Certificate and the Warrants. In connection
therewith, the Company shall cause its Board of Directors to (a) adopt
proper resolutions authorizing such increase, (b) recommend to and
otherwise use its best efforts to promptly and duly obtain stockholder
approval to carry out such resolutions (and hold a special meeting of the
stockholders no later than the earlier to occur of the sixtieth (60th)
day after delivery of the proxy materials relating to such meeting and
the ninetieth (90th) day after request by a holder of Securities to issue
the number of Underlying Common Stock in accordance with the terms
hereof) and (c) within five (5) Business Days of obtaining such
stockholder authorization, file an appropriate amendment to the Company's
certificate of incorporation to evidence such increase.
5.7. Reservation and Listing of Underlying Common Stock.
(a) The Company shall (i) in the time and manner required,
if so required, by the ASE and such other national securities exchange or
market or trading or quotation facility on which the Common Stock is then
listed for trading, prepare and file with the ASE (and such other
national securities exchange or market or trading or quotation facility
on which the Common Stock is then listed for trading) an additional
shares listing application covering a number of shares of Common Stock
which is not less than the Required Minimum as of the Closing Date, (ii)
take all steps necessary to cause such shares of Common Stock to be
approved for listing in the ASE (as well as on any such other national
securities exchange or market or trading or quotation facility on which
the Common Stock is then listed) as soon as possible thereafter, and
(iii) provide to the Purchaser evidence of such listing, and the Company
shall maintain the listing of its Common Stock thereon.
(b) The Company shall maintain a reserve of shares of
Common Stock for issuance upon conversion, redemption or call in full of
the Convertible Note the payment of interest thereon and exercise of the
Warrants in accordance with this Agreement, and the Warrants,
respectively, in such amount as may be required to fulfill its
obligations in full under the Transaction Documents.
5.8. Conversion and Exercise Procedures. The Notice of Conversion or
Exercise under the Convertible Note and the Warrants set forth the
totality of the procedures with respect to the conversion of the
Convertible Note and exercise of the Warrants, including the information
and instructions as may be reasonably necessary to enable the Purchaser
to convert the Convertible Note and exercise its Warrants as contemplated
in the Convertible Note, the Warrant Agreement and the Warrants (as
applicable).
5.9. Notice of Breaches. Each of the Company and the Purchaser shall
give prompt written notice to the other of any breach by it of any
representation, warranty or other agreement contained in any Transaction
Document, as well as any events or occurrences arising after the date
hereof which would reasonably be likely to cause any representation or
warranty or other agreement of such party, as the case may be, contained
therein to be incorrect or breached as of the Closing Date. However, no
disclosure by a party pursuant to this Section shall be deemed to cure
any breach of any representation, warranty or other agreement contained
in any Transaction Document..
5.10. Certain Securities Laws Issues; Publicity.
The Company shall: (i) on or immediately following the
Closing Date, issue a press release reasonably acceptable to the
Purchaser disclosing the transactions contemplated hereby, (ii) file with
the Commission a Report on Form 8-K or Form 10-Q (as applicable)
disclosing the transactions contemplated hereby within the required time
periods therefor, and (iii) timely file with the Commission a Form D
promulgated under the Securities Act as required under Regulation D
promulgated under the Securities Act and provide a copy thereof to the
Purchaser promptly after the filing thereof. The Company shall, no less
than two (2) Business Days prior to the filing of any disclosure required
by clauses (ii) and (iii) above, provide a copy thereof to the Purchaser.
The Company and the Purchaser shall consult with each other in issuing
any press releases or otherwise making public statements or filings and
other communications with the Commission or any regulatory agency or
stock market or trading facility with respect to the transactions
contemplated hereby and neither party shall issue any such press release
or otherwise make any such public statement, filings or other
communications pertaining to the transactions contemplated hereby without
the prior written consent of the other, which consent shall not be
unreasonably withheld or delayed, except that no prior consent shall be
required if such disclosure is required by law or such consent can not
reasonably be expected to be received prior to the time required to
complete such filing or make such statement in accordance with such
applicable law, in which such case the disclosing party shall provide the
other party with notice of such public statement, filing or other
communication. Notwithstanding the foregoing, the Company shall not
publicly disclose the name of the Purchaser, or include the name of the
Purchaser in any filing with the Commission, or any regulatory agency,
trading facility or stock market without the prior written consent of the
Purchaser, except to the extent such disclosure is required by law, in
which case the Company shall provide the Purchaser with a copy of such
disclosure. A party shall be deemed to have consented or given a written
consent hereunder if such party fails to give its consent, orally or in
writing where so required, within two (2) business days of receipt of the
request for consent.
5.11. Additional Security Interests. Except in circumstances where the
Company exercises its option to prepay the Convertible Note in accordance
with the provisions thereof, the Company covenants that it will not enter
into any agreement, create, incur, assume or permit any mortgage, pledge,
lien, security interest or other preferential arrangement, charge or
encumbrance of any nature which would create indebtedness or security
ranking senior to or pari passu with the Convertible Note upon or with
respect to the assets of the Company or the Subsidiaries, until repayment
in full or conversion of the Convertible Note.
5.12. Transfer of Intellectual Property Rights. Except in circumstances
where the Company exercises its option to prepay the Convertible Note in
accordance with the provisions thereof, the Company shall not sell or
otherwise dispose of any Intellectual Property Rights or allow any of the
Intellectual Property Rights to become subject to any Liens, or fail to
renew such Intellectual Property Rights (if renewable and it would
otherwise lapse if not renewed). Notwithstanding the foregoing, the
Company may license the right to promote and use its Intellectual
Property Rights in the ordinary course of its business.
5.13. Use of Proceeds. The Company shall use the net proceeds from the
sale of Securities hereunder for working capital purposes.
5.14. Reimbursement. If the Purchaser, other than by reason of its gross
negligence or willful misconduct, becomes involved in any capacity in any
action, proceeding or investigation brought by or against any Person,
including stockholders of the Company, in connection with or as a result
of the consummation of the transactions contemplated by Transaction
Documents, the Company will reimburse the Purchaser for its reasonable
legal and other expenses (including the cost of any investigation and
preparation and travel in connection therewith) incurred in connection
therewith, as such expenses are incurred. In addition, other than with
respect to any matter in which any of the Purchaser is a named party, the
Company will pay the Purchaser the charges, as reasonably determined by
the Purchaser, for the time of any officers or employees of such
Purchaser devoted to appearing and preparing to appear as witnesses,
assisting in preparation for hearings, trials or pretrial matters, or
otherwise with respect to inquiries, hearings, trials, and other
proceedings relating to the subject matter of this Agreement. The
reimbursement obligations of the Company under this paragraph shall be in
addition to any liability which the Company may otherwise have, shall
extend upon the same terms and conditions to any Affiliates of the
Purchaser who are actually named in such action, proceeding or
investigation, and partners, directors, agents, employees and controlling
persons (if any), as the case may be, of the Purchaser and any such
Affiliate, and shall be binding upon and inure to the benefit of any
successors, assigns, heirs and personal representatives of the Company,
the Purchaser and any such Affiliate and any such Person. The Company
also agrees that neither the Purchaser nor any such Affiliates, partners,
directors, agents, employees or controlling persons shall have any
liability to the Company or any Person asserting claims on behalf of or
in right of the Company in connection with or as a result of the
consummation of the Transaction Documents except to the extent that any
losses, claims, damages, liabilities or expenses incurred by the Company
result from the gross negligence or willful misconduct of the Purchaser
or such other Persons in connection with the transactions contemplated by
this Agreement.
5.15. Stockholders Rights Plan. In the event that a stockholders rights
plan is adopted by the Company, no claim will be made or enforced by the
Company or any other Person that the Purchaser is an "Acquiring Person"
under any such plan or in any way could be deemed to trigger the
provisions of such plan by virtue of receiving Underlying Common Stock
under the Transaction Documents.
5.16. Fees. The Purchaser shall have no obligation with respect to any
fees or with respect to any claims made by or on behalf of other Persons
for fees or commissions to any broker, financial advisor or consultant,
finder, placement agent, investment banker or bank that may be due in
connection with the transactions contemplated by this Agreement. The
Company shall indemnify and hold harmless the Purchaser, its employees,
officers, directors, agents, and partners, and its respective Affiliates,
from and against all claims, losses, damages, costs (including the costs
of preparation and attorney's fees) and expenses suffered in respect of
any such claimed or existing fees, as such fees and expenses are incurred.
5.17. Registration Rights Agreement.
The Company shall perform all of its obligations under the
Registration Rights Agreement in a timely fashion.
6. CONDITIONS TO CLOSING
6.1. Conditions to Purchaser's Obligations at the Closings. The
obligation of the Purchaser to consummate the transactions contemplated
herein to be consummated on the Closing Date is subject to the
satisfaction, on or prior to the Closing Date of the conditions set forth
below and applicable thereto, any of which may be waived in writing by
the Purchaser:
(a) Representations and Warranties True; Performance of Obligations.
Each of the representations and warranties of the Company contained
herein shall be true and correct, in all material respects, on and as of
the Closing Date. The Company shall have performed and complied, in all
material respects, with the covenants and provisions of this Agreement
required to be performed or complied with by it at or prior to the
Closing Date.
(b) Legal Investment. On the Closing Date, the sale and issuance of
the Convertible Note, the Warrants and the proposed issuance of the
Underlying Common Stock shall be legally permitted by all laws and
regulations to which Purchaser and the Company are subject.
(c) Corporate Documents. The Company shall have delivered to Purchaser
or its counsel, copies of all corporate documents of the Company as
Purchaser shall reasonably request.
(d) Reservation of Underlying Common Stock. The Underlying Common
Stock issuable upon conversion of the Convertible Note and the exercise
of the Warrants shall have been duly authorized and reserved for issuance.
(e) Proceedings and Documents. All corporate and other proceedings in
connection with the transactions contemplated at the Closings and all
documents and instruments incident to such transactions shall be
reasonably satisfactory in substance and form to the Purchaser and its
counsel, and the Purchaser and its counsel shall have received all such
counterpart originals or certified or other copies of such documents as
they may reasonably request.
(f) Delivery of Documents at the Closing. The Company shall have
executed and delivered to the Purchaser the following documents on or
prior to the Closing Date each of which shall be in a form satisfactory
to the Purchaser:
(i) the Registration Rights Agreement;
(ii) the Convertible Note;
(iii) the Warrant Agreement;
(iv) the Common Warrant to acquire 500,000 shares of Common Stock;
(v) Secretary's Certificate. A Certificate of the Assistant Secretary
of the Company attaching (A) the Certificate of Incorporation of the
Company in effect at the Closing, (B) the Bylaws of the Company in effect
at the Closing, (C) copies of resolutions by the Board of Directors
authorizing and approving this Agreement, the issuance and delivery of
the Convertible Note, the Warrant Agreement, the Securities and the
Registration Rights Agreement; and (D) certifying as to the incumbency of
the officers entering into this Agreement, the Related Agreements and any
other documents contemplated by this Agreement;
(vi) Additional Documents. The other agreements, instruments and
documents referred to in this Article 6 hereof and such other agreements,
instruments and documents as the Purchaser or its counsel, including an
opinion of the Company's counsel, may reasonably request; and
(vii) Fee Agreement. A fee agreement with Xxxx Xxxxx, Star Capital Inc.,
and/or American Capital Consultants, Ltd., to pay fees of 4% of the
Advances made by the Purchaser under the Convertible Note and provide
warrants to acquire 125,000 Common Stock.
6.2. Conditions to Obligations of the Company. The obligation of the
Company to consummate the transactions contemplated herein to be on the
Closing Date is subject to the satisfaction, on or prior to the Closing
Date, of the conditions set forth below and expressly applicable thereto,
any of which may be waived in writing by the Company:
(a) Representations and Warranties True. Each of the representations
and warranties of the Purchaser contained herein shall be true and
correct on and as of the Closing Date. The Purchaser shall have
performed and complied with the covenants and provisions of this
Agreement required to be performed or complied with by it at or prior to
the Closing Date.
(b) Deliveries by Purchaser to the Company at the Closing. At the
Closing, Purchaser shall deliver, or cause to be delivered, to the
Company the following:
(i) Registration Rights Agreement. An executed Registration Rights
Agreement;
(ii) Purchase Price. Immediately available funds in the aggregate
amount of Seven Hundred Fifty Thousand Dollars ($750,000) by wire
transfer as provided in Section 2.1 hereof;
(iii) Additional Documents. The other agreements, instruments and
documents referred to in this Section 6.2 and such other agreements,
instruments and documents as the Company or its counsel may reasonably
request.
7. MISCELLANEOUS
7.1. Fees and Expenses. Except as otherwise set forth in the
Registration Rights Agreement, each party shall pay the fees and expenses
of its advisers, counsel, accountants and other experts, if any, and all
other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement,
except that the Company shall pay Purchaser's legal expenses incurred
with respect to the transactions contemplated herein in an amount equal
to Ten Thousand Seven Hundred Dollars ($10,700). The Company shall pay
all stamp and other taxes and duties levied in connection with the
issuance of the Securities.
7.2. Entire Agreement; Amendments. The Transaction Documents, together
with the Exhibits and Schedules thereto contain the entire understanding
of the parties with respect to the subject matter hereof and supersede
all prior agreements and understandings, oral or written, with respect to
such matters, which the parties acknowledge have been merged into such
documents, exhibits and schedules.
7.3. Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and
shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile
at the facsimile telephone number specified in this Section prior to 5:00
p.m. (Denver time) on a Business Day, (ii) the Business Day after the
date of transmission, if such notice or communication is delivered via
facsimile at the facsimile telephone number specified in this Agreement
later than 5:00 p.m. (Denver time) on any date and earlier than 11:59
p.m. (Denver time) on such date, (iii) the Business Day following the
date of mailing, if sent by nationally recognized overnight courier
service, or (iv) if sent other than by the methods set forth in (i)-(iii)
of this Section 7.3 upon actual receipt by the party to whom such notice
is required to be given. The address for such notices and communications
shall be as follows:
If to the Company: Medix Resources, Inc.
0000 X. Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx Xxxxxxx, Xxxxxxxx
00000
Attn: Xxxx X. Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
With copies to: Xxxx Xxxxxxx
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx
00000
Tel: (000) 000-0000
Fax: (000) 000-0000
If to the Purchaser: RoyCap Inc.
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
Attn: Xxxxxx Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
With copies to: Fogler, Xxxxxxxx, XXX
Xxxxx 0000, Xxxxx Xxxxx Xxxxx
Xxxxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attn: Xxxxxxx Xxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
or such other address as may be designated in writing hereafter, in the
same manner, by such Person.
7.4. Amendments; Waivers. No provision of this Agreement may be waived
or amended except in a written instrument signed, in the case of an
amendment, by both the Company and the Purchaser or, in the case of a
waiver, by the party against whom enforcement of any such waiver is
sought. No waiver of any default with respect to any provision, condition
or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of either party to
exercise any right hereunder in any manner impair the exercise of any
such right accruing to it thereafter.
7.5. Headings. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or
affect any of the provisions hereof.
7.6. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted
assigns. The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of the
Purchaser. Except as set forth in Section 5.2(a), the Purchaser may not
assign this Agreement or any of the rights or obligations hereunder
without the consent of the Company.
7.7. No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective successors and
permitted assigns and is not for the benefit of, nor may any provision
hereof be enforced by, any other Person.
7.8. Governing Law; Jurisdiction. This Agreement shall be governed in
all respects by the laws of the State of New York without regard to the
conflicts of laws principles of any jurisdiction. The Company and the
Purchaser hereby irrevocably submit to the jurisdictions of either the
Province of Ontario or the State of New York, as determined by the party
initiating any proceeding, for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waive, and agree not to assert
in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, or that such suit, action
or proceeding is improper. Each of the Company and the Purchaser hereby
irrevocably waives personal service of process and consents to the
process being served in any such suit, action or proceeding by receiving
a copy thereof sent to the Company at the address in effect for notices
to it under this instrument and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law.
7.9. Survival. The representations, warranties, agreements and
covenants contained herein shall survive for a period of one (1) year
after the Closing Date.
7.10. Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one
and the same agreement and shall become effective when counterparts have
been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission, such
signature shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature page were an
original thereof.
7.11. Severability. In case any one or more of the provisions of this
Agreement shall be invalid or unenforceable in any respect, the validity
and enforceability of the remaining terms and provisions of this
Agreement shall not in any way be affected or impaired thereby and the
parties will attempt to agree upon a valid and enforceable provision
which shall be a reasonable substitute therefor, and upon so agreeing,
shall incorporate such substitute provision in this Agreement.
7.12. Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages the
Purchaser will be entitled to specific performance of the obligations of
the Company under the Transaction Documents. Each of the Company and the
Purchaser agree that monetary damages may not be adequate compensation
for any loss incurred by reason of any breach of its obligations
described in the foregoing sentence and hereby agrees to waive in any
action for specific performance of any such obligation the defense that a
remedy at law would be adequate.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized signatories
dated as of the date first indicated above.
MEDIX RESOURCES, INC.
By: __________________________
Name: Xxxx X. Xxxxx
Title: Executive Vice-President &
Chief
Financial Officer
ROYCAP INC.
By: ___________________________
Name:
Title:
SCHEDULE 4.1(q)
Title
None.
Exhibit A
Convertible Note
Exhibit B
Warrant Agreement
Exhibit C
Warrant for Common Stock
SECURITIES PURCHASE AGREEMENT
by and between
MEDIX RESOURCES, INC.
and
ROYCAP INC.
dated
December 29, 2000
TABLE OF CONTENTS
SECURITIES PURCHASE AGREEMENT
R E C I T A LS
1. DEFINITIONS
1.1 Certain Terms
1.2 Knowledge and Belief
2. SALE AND PURCHASE
2.1 Sale and Purchase
2.2 Availment
2.3 Conditions to Subsequent Advances
3. CLOSING, DELIVERY AND PAYMENT
3.1 Closing
3.2 Delivery; Payment
4. REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of the Company
4.2 Representations and Warranties of the Purchaser
5. ADDITIONAL AGREEMENTS
5.1 No Other Representations
5.2 Transfer Restrictions
5.3 Acknowledgment of Dilution
5.4 Furnishing of Information
5.5 Integration
5.6 Increase in Authorized Shares
5.7 Reservation and Listing of Underlying Common Stock
5.8 Conversion and Exercise Procedures
5.9 Notice of Breaches
5.10. Certain Securities Laws Issues; Publicity
5.11. Additional Security Interests
5.12. Transfer of Intellectual Property Rights
5.13. Use of Proceeds
5.14. Reimbursement
5.15. Stockholders Rights Plan
5.16. Fees
5.17. Registration Rights Agreement
6. CONDITIONS TO CLOSING
6.1 Conditions to Purchaser's Obligations at the Closings
6.2 Conditions to Obligations of the Company
7. MISCELLANEOUS
7.1 Fees and Expenses
7.2 Entire Agreement; Amendments
7.3 Notices
7.4 Amendments; Waivers
7.5 Headings
7.6 Successors and Assigns
7.7 No Third-Party Beneficiaries
7.8 Governing Law; Jurisdiction
7.9 Survival
7.10. Execution
7.11. Severability
7.12. Remedies
SCHEDULE 4.1(q) Title
Exhibit A
Convertible Note
A-2
Exhibit B
Warrant Agreement
A-3
Exhibit C
Warrant for Common Stock
A-4