EXHIBIT 10.5
ACCESS RADIOLOGY CORPORATION
SECURITIES PURCHASE AGREEMENT
THIS Securities PURCHASE AGREEMENT (this "Agreement") is made as of July
28, 1998 by and between ACCESS RADIOLOGY CORPORATION, a Delaware corporation
(the "Company"), and each of the persons and entities listed on the signature
pages hereof (individually, an "Investor" and collectively, the "Investors").
The parties agree as follows:
1. PURCHASE AND SALE OF Securities.
Sale and Issuance of Securities.
(a) The Company has filed with the Secretary of State of the State of
Delaware a Certificate of Designations, Preferences and Relative, Participating,
Optional or Other Special Rights of the Series K Preferred Stock in the form
attached hereto as Exhibit A (the "Certificate of Designation").
(b) On the terms of this Agreement, each Investor agrees to purchase,
if the Company delivers a Drawdown Notice as provided in Section 1.2(a), shares
of the Company's Series K Preferred Stock at a purchase price determined
pursuant to subsection (c) below. Each Investor agrees to purchase a number of
shares of the Company's Series K Preferred Stock equal to the amount of the
commitment (the "Commitment") set forth opposite each Investor's name on the
signature pages hereof divided by the Series K Purchase Price as defined in
subsection (c) below (rounded downward to the nearest whole share). The Series K
Preferred Stock will have the rights, privileges, and restrictions set forth in
the Certificate of Designation and the Company's Certificate of Incorporation.
The obligations of the Investors under this Agreement are several and not joint.
(c) If a Drawdown Notice is delivered on or before December 31, 1998,
the Series K Purchase Price will be $1.40 per share. If a Drawdown Notice is
delivered after December 31, 1998, the Series K Purchase Price will be $1.50 per
share.
(d) Upon the execution of this Agreement, the Company is delivering
to each Investor a warrant in the form of Exhibit B (each a "Warrant" and
collectively the "Warrants") to purchase a number of shares of Common Stock of
the Company equal to such Investor's Commitment multiplied by 290/1500 (rounded
downward to the nearest whole share).
Closing.
(a) At any time on or after the date hereof and on or before March
31, 1999, the Company may deliver to each Investor a notice (the "Drawdown
Notice") stating that the Company has irrevocably elected to sell all of the
shares of Series K Preferred Stock subject to this Agreement to the Investors.
The closing of the purchase and sale of the Series K Preferred Stock (the
"Closing") will take place at the principal offices of the Company at 10:00 a.m.
(or at such other location and time of day as shall be agreed to by all of the
parties hereto) on the date that is 45 calendar days after the date of the
Drawdown Notice (or, if such 45th day is not a business day, on the next
succeeding business day, or any other date agreed to by all of the parties
hereto). If any Investor or Investors shall default on their obligations to
purchase Series K Preferred Stock at the Closing, all other Investors shall
nonetheless remain obligated to proceed with the Closing and to purchase Series
K Preferred Stock as set forth herein. If any Investor or Investors shall
default on their obligations to purchase Series K Preferred Stock at the
Closing, the Company shall promptly notify the non-defaulting Investors, each of
whom shall then have the option to take up and pay for (on the terms set forth
in this Agreement) all or part of such non-defaulting Investor's pro-rata share
(based upon the Commitments of all of the non-defaulting Investors) of the
shares of Series K Preferred Stock that the defaulting Investor or Investors
have failed to purchase.
(b) At the Closing, the Company will deliver to each Investor a
certificate representing the shares of Series K Preferred Stock that such
Investor is purchasing at Closing against payment of the purchase price
therefore by check or wire transfer to be made at the Closing by each Investor.
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby represents and warrants to each Investor as of the date
of this Agreement that, except as set forth on the schedule of exceptions
attached as Exhibit C (the "Schedule of Exceptions"):
2.1 Organization; Good Standing; Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware, and is duly qualified and authorized to transact
business and is in good standing as a foreign corporation in each jurisdiction
in which the failure so to qualify would have a material adverse effect on
business, properties or financial condition of the Company (a "Material Adverse
Effect"). The Company has all requisite corporate power and authority to own and
operate its properties and assets and to carry on its business as now conducted
and as now proposed to be conducted. The Company has all requisite corporate
power and authority to execute and deliver the Registration Rights Agreement in
substantially the form attached hereto as Exhibit D (the "Registration Rights
Agreement"), to issue and sell the Series K Preferred Stock and the Warrants
pursuant to this Agreement and the Common Stock (as defined in Section 2.5)
issuable upon conversion or exercise thereof (as the case may be) and to carry
out the provisions of this Agreement, the Warrants, the Registration Rights
Agreement and the Certificate of Designation.
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2.2 Authorization. All corporate action on the part of the Company and
its officers, directors and stockholders for the authorization, execution and
delivery of this Agreement, the Warrants and the Registration Rights Agreement,
the performance of all of the obligations of the Company hereunder and
thereunder and the authorization, issuance (or reservation for issuance), sale
and delivery of the Series K Preferred Stock and the Warrants issued or issuable
hereunder and the Common Stock issuable upon conversion or exercise thereof (as
the case may be) has been taken or will be taken prior to the Closing. This
Agreement, the Warrants and the Registration Rights Agreement, when executed and
delivered, will constitute valid and legally binding obligations of the Company,
enforceable in accordance with their respective terms, except as limited by
applicable bankruptcy, reorganization, insolvency or other laws affecting
creditors' rights generally or by general principles of equity.
2.3 Valid Issuance Of Preferred And Common Stock. The Series K Preferred
Stock to be purchased by the Investors hereunder, when issued, sold and
delivered in accordance with the terms of this Agreement for the consideration
expressed herein, will be duly and validly issued, fully paid and nonassessable
and will be free of restrictions on transfer other than restrictions on transfer
under this Agreement and the Registration Rights Agreement and under applicable
state and federal securities laws. The Common Stock issuable upon conversion or
exercise (as the case may be) of the Series K Preferred Stock and the Warrants
issued or issuable under this Agreement will have been duly and validly reserved
for issuance and, upon issuance in accordance with the terms of the Company's
Certificate of Incorporation, will be duly and validly issued, fully paid and
nonassessable and will be free of restrictions on transfer other than
restrictions on transfer under this Agreement and the Registration Rights
Agreement and under applicable state and federal securities laws.
2.4 Governmental Consents. No consent, approval, qualification, order or
authorization of or filing with any local, state or federal governmental
authority is required on the part of the Company for the execution, delivery or
performance of this Agreement, the Warrants or the Registration Rights
Agreement, and the offer, sale or issuance of the Series K Preferred Stock and
the Warrants, except (a) the filing of the Certificate of Designation with the
Secretary of State of the State of Delaware and (b) such filings as have been
made prior to the date of this Agreement, except any notices of sale required to
be filed with the Securities and Exchange Commission under Regulation D of the
Securities Act of 1933, as amended (the "Securities Act"), and such post-closing
filings as may be required under applicable state securities laws, all of which
will be timely filed within the applicable periods therefor.
2.5 Capitalization And Voting Rights. The authorized capital of the
Company consists on the date of this Agreement of:
(a) 35,000,000 shares of common stock, par value $0.01 per share
("Common Stock"), of which 1,056,698 shares are issued and outstanding.
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(b) 15,000,000 shares of Preferred Stock, par value $0.01 per share
("Preferred Stock"): (1) 716 of which have been designated as Series B Preferred
Stock (all of which are issued and outstanding); (2) 450 of which have been
designated as Series C Preferred Stock (all of which are issued and
outstanding); (3) 345 of which have been designated as Series E Preferred Stock
(344.39 of which are issued and outstanding); (4) 1,000 of which have been
designated as Series F Preferred Stock (all of which are issued and
outstanding); (5) 816 of which have been designated as Series G Preferred Stock
(815.87 of which are issued and outstanding); (6) 400 of which have been
designated as Series H Preferred Stock (all of which are issued and
outstanding); (7) 8,140,000 of which have been designated as Series J Preferred
Stock (7,730,909 of which are issued and outstanding); and (8) 1,785,800 have
been designated as Series K Preferred Stock (none of which are issued and
outstanding).
(c) The capitalization table attached to the Schedule of Exceptions
is accurate.
(d) The outstanding shares of Common Stock and Preferred Stock have
been duly authorized and validly issued, are fully paid and nonassessable and
were issued in accordance with the registration or qualification provisions of
the Securities Act and any relevant state securities laws or pursuant to valid
exemptions therefrom.
(e) Except for (1) this Agreement, (2) the conversion privileges of
the Preferred Stock, (3) the Investors Rights Agreement dated as of September
30, 1997 among the Company and certain holders of the Company's Series J
Preferred Stock, (4) currently outstanding options to purchase 2,334,706 shares
of Common Stock granted to employees pursuant to the Company's 1994 Stock Plan
(the "Option Plan") and currently outstanding options to purchase 52,898 shares
of Common Stock granted to employees outside of the Option Plan, (5) warrants to
purchase 255,482 shares of Common Stock (not including the Warrants) granted in
connection with private placements of the Company's securities, and (6) warrants
to purchase 409,091 shares of Series J Preferred Stock, there are not
outstanding any options, warrants, rights (including conversion or preemptive
rights and rights of first refusal), proxy or stockholder agreements or
agreements of any kind for the purchase or acquisition from the Company of any
of its securities. In addition to the aforementioned options, the company has
reserved an additional 412,596 shares of Common Stock for purchase upon exercise
of options to be granted in the future under the Option Plan. The Company is not
a party or subject to any agreement or understanding, and to the Company's
knowledge there is no agreement or understanding between any other persons, that
affects or relates to the voting or giving of written consents with respect to
any security of the Company or the voting by a director of the Company.
2.6 Subsidiaries. The Company does not own or control, directly or
indirectly, any interest in any other business entity. The Company is not a
participant in any joint venture, partnership or similar arrangement.
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2.7 Contracts And Other Commitments. The Company is not bound by any
contract, agreement, lease or commitment, written or oral, absolute or
contingent, other than (a) contracts for the purchase or license of supplies,
software and services that were entered into in the ordinary course of business
that do not extend for more than one year from the date hereof, (b) sales
contracts entered into the ordinary course of business and (c) contracts
terminable at will by the Company on no more than 30 days' notice without cost
or liability to the Company. For the purpose of this Section 2.7, employment and
consulting contracts, contracts with labor unions, license agreements and any
other agreements relating to the acquisition or disposition of Intangibles (as
defined in Section 2.18) other than standard end-user license agreements will
not be considered to be contracts entered into the ordinary course of business.
2.8 Related Party Transactions. No employee, officer, consultant,
stockholder or director of the Company or member of his or her immediate family
is indebted to the Company, nor is the Company indebted (or committed to make
loans or extend or guarantee credit) to any of them, other than for (a) payment
of salary for services rendered, (b) reimbursement for reasonable expenses
incurred on behalf of the Company and (c) other standard employee benefits made
generally available to all employees (including stock option agreements
outstanding under the Option Plan). To the Company's knowledge, no officer,
director, or employee of the Company or any member of his or her immediate
family is, directly or indirectly, interested in any material contract with the
Company (other than such contracts as relate to any such person's employment
with the Company or ownership of capital stock or other securities of the
Company).
2.9 Registration Rights. Except as provided in (1) the Investors Rights
Agreement dated as of September 30, 1997 among the Company and certain holders
of the Company's Series J Preferred Stock, and (2) Registration Rights
Agreements in substantially the form of the Registration Rights Agreement
attached hereto as Exhibit D, the Company is not under any obligation and has
not granted any rights to register under the Securities Act any of its
outstanding securities or any of its securities that may subsequently be issued.
2.10 Clearances, Approvals, Etc. The Company has all the clearances,
approvals, franchises, permits, licenses and any similar authority including,
without limitation, all approvals and clearances from the U.S. Food and Drug
Administration, the absence of which would have a Material Adverse Effect, and
the Company believes it can obtain, without undue burden or expense, any similar
authority the absence of which would have a Material Adverse Effect with respect
to the business of the Company as now proposed to be conducted. The Company is
not in default in any material respect under any of such franchises, permits,
licenses or other similar authority.
2.11 Compliance With Other Instruments. The Company is not in violation
or default of (a) any provision of its certificate of incorporation or bylaws,
(b) any provision of any mortgage, indenture, agreement, instrument or contract
to which it is a party or by which
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it is bound or (c) to the best of the Company's knowledge, any judgment, order,
writ, decree, statute, rule, regulation or restriction applicable to it
including, without limitation, the U.S. Federal Food, Drug and Cosmetic Act, as
amended, and regulations promulgated thereunder, which default or violation has
had or could reasonably be expected to have a Material Adverse Effect. The
execution, delivery and performance by the Company of this Agreement, the
Warrants and the Registration Rights Agreement and the consummation of the
transactions contemplated hereby and thereby will not result in any such
violation or be in material conflict with or constitute, with or without the
passage of time or giving of notice, either a material default under any such
provision or an event that results in the creation of any material lien, charge
or encumbrance upon any assets of the Company or the suspension, revocation,
impairment, forfeiture or nonrenewal of any material franchise, permit, license
or similar authority applicable to the Company, its business, operations or any
of its material assets or properties.
2.12 Litigation. There is no action, suit proceeding or investigation
pending or, to the Company's knowledge, currently threatened against the Company
that questions the validity of this Agreement, the Warrants or the Registration
Rights Agreement or the right of the Company to enter into such agreements, or
to consummate the transactions contemplated hereby or thereby, or that might
result, either individually or in the aggregate, in a Material Adverse Effect or
in any change in the current equity ownership of the Company. The Company is not
a party to or, to its knowledge, named in or subject to any material order,
writ, injunction, judgment or decree of any court, government agency or
instrumentality. There is no action, suit, proceeding or investigation by the
Company currently pending or that the Company currently intends to initiate.
2.13 Disclosure. The Company has provided each Investor with all
information reasonably available to it without undue expense that such Investor
has requested in writing for deciding whether to purchase the Series K Preferred
Stock.
2.14 Offering. Subject in part to the truth and accuracy of each
Investor's representations set forth in this Agreement, the offer, sale and
issuance of the Series K Preferred Stock and the Warrants as contemplated by
this Agreement are exempt from the registration requirements of the Securities
Act, and neither the Company nor any authorized agent acting on its behalf will
take action hereafter that would cause the loss of such exemption.
2.15 Title To Property And Assets; Leases. Except for (a) liens
reflected in the Financial Statements (as defined in Section 2.16), (b) liens
for current taxes not yet due or payable, (c) liens imposed by law and incurred
in the ordinary course of business for obligations not past due to carriers,
warehousemen, laborers, materialmen and the like, (d) liens in respect of
pledges or deposits under workers' compensation laws or similar legislation, (e)
liens securing money borrowed from a bank or other financial institution, or (f)
minor defects in title, the Company has good and marketable title to its
property and assets free and
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clear of all material mortgages, liens, claims and encumbrances. With respect to
the property and assets it leases, the Company is in compliance with such leases
in all material respects and, to the Company's knowledge, hold a valid leasehold
interest free of any mortgages, liens, claims or encumbrances, subject to
clauses (a)-(f) above.
2.16 Financial Statements. The Company has delivered to each Investor
its audited financial statements (balance sheet and profit and loss statement,
statement of stockholder's equity and statement of cash flows including notes
thereto) at December 31, 1997 and for the fiscal year then ended and its
unaudited financial statements (balance sheet and profit and loss statement and
statement of cash flows) at March 31, 1998 and for the three months then ended (
the "Financial Statements"). The Financial Statements have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods indicated, except that the unaudited Financial
Statements omit notes thereto required by generally accepted accounting
principles. The Financial Statements fairly represent the financial condition
and operating results of the Company as of the dates and for the periods
indicated therein (subject in the case of unaudited financial statements to
normal year end adjustments). Except as set forth in the Financial Statements,
the Company has no material liabilities, contingent or otherwise, other than (a)
liabilities incurred in the ordinary course of business subsequent to March 31,
1998 and (b) obligations under contracts and commitments not required under
generally accepted accounting principles to be reflected in the Financial
Statements that in both cases, individually or in the aggregate, are not
material to the business, properties or financial condition of the Company.
Except as disclosed in the Financial Statements, the Company is not a guarantor
or indemnitor of any indebtedness of any other person or entity. The Company
maintains a standard system of accounting established and administered in
accordance with generally accepted accounting principles.
2.17 Changes. Since March 31, 1998 there has not been:
(a)any change in the assets, liabilities, financial condition or
operating results of the Company from that reflected in the Financial
Statements, except changes in the ordinary course of business that have not had
a Material Adverse Effect;
(b)any damage, destruction or loss, whether or not covered by
insurance, that could reasonably be expected to have a Material Adverse Effect;
(c)any waiver of compromise by the Company of a valuable right or a
material debt owed to it, other than in the ordinary course of business;
(d)any satisfaction or discharge of any lien, claim or encumbrance or
payment of any obligation by the Company, except to the extent such satisfaction
or discharge will not have a Material Adverse Effect;
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(e)any material change to a material contract or arrangement by which
the Company or any of its assets is bound or subject;
(f)any material change in any compensation arrangement or agreement
with any officer, consultant, director or stockholder of the Company or any of
its Subsidiaries;
(g)any sale, assignment or transfer of any material Intangibles of the
Company or any of its Subsidiaries, other than in the ordinary course of
business;
(h)any resignation or termination of employment of any key employee or
key consultant of the Company or any of its Subsidiaries;
(i) any mortgage, lien, claim encumbrance, pledge or security interest
created by the Company with respect to any of its material properties or assets,
except liens for taxes not yet due or payable and liens securing debt for money
borrowed to a bank or other financial institution;
(j) any declaration, setting aside or payment of any dividend or other
distribution of the Company's capital stock, or any direct or indirect
redemption, purchase or other acquisition of any of such stock by the Company;
(k) to the Company's knowledge, any other event or condition of any
character that could reasonably be expected to have a Material Adverse Effect;
or
(l) any agreement or commitment by the Company or any of its
Subsidiaries to do any of the things described in this Section 2.17.
2.18 Intangibles. To the best of its knowledge, the Company owns or
possesses sufficient legal rights to all patents, trademarks, service marks,
trade names, copyrights, trade secrets, licenses, information and proprietary
rights and processes (collectively, "Intangibles") necessary for its business as
now conducted and as now proposed to be conducted without any conflict with or
infringement of the rights of others. Except for end-user license agreements,
confidentiality agreements, and licenses set forth in Section 2.18 of the
Schedule of Exceptions (the "Material Licenses"), there are no outstanding
options, licenses or agreements of any kind relating to the foregoing, nor is
the Company bound by or party to any options, licenses or agreements of any kind
with respect to the Intangibles of any other person or entity. To the Company's
knowledge, each Material License is valid and in full force and effect, and is
enforceable by the Company in accordance with its terms. To the Company's
knowledge, no person or entity has materially violated or breached, or declared
or committed any default under, any Material License. To the Company's
knowledge, no event has occurred, and no circumstance or condition exists, that
could reasonably be expected to (with or without notice or lapse of time) (a)
result in a material violation or breach of any of the provisions of any
Material License, (b) give any person or entity the right to declare a default
or exercise any
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remedy under any Material License, (c) give any person or entity the right to
accelerate the maturity or performance of any Material License or (d) give any
person or entity the right to cancel, terminate or modify any Material License.
Neither the Company nor any of its Subsidiaries has received any communications
alleging that the Company or any of its Subsidiaries has violated or breached
any provision of a Material License or misappropriated or by conducting its
business as proposed would misappropriate any of the Intangibles of any other
person or entity.
2.19 Employees; Employee Compensation. To the Company's knowledge, there
is no strike, labor dispute or union or union organization activities pending or
threatened between the Company and any of its employees. None of the employees
of the Company belongs to any union or collective bargaining unit. To the
Company's knowledge, the Company has complied in all material respects with all
applicable state and federal equal opportunity and other laws related to
employment. To the Company's knowledge, no employee of the Company is or will be
in violation of any judgment, decree or order, or any term of any employment
contract, patent disclosure agreement or other contract or agreement relating to
the relationship of any such employee with the Company, or any other party
because of the nature of the business conducted or presently proposed to be
conducted by the Company or to the use by the employee of his or her best
efforts with respect to such business. Neither the execution nor delivery of
this Agreement or the Registration Rights Agreement nor the carrying on of
business of the Company nor the conduct of such business as proposed will, to
the Company's knowledge, conflict with or result in a breach of terms,
conditions or provisions of, or constitute a default under, any contract,
covenant or instrument under which any such employee is now obligated. The
Company is not a party to or bound by any currently effective employment
contract, deferred compensation agreement, bonus plan, incentive plan (other
than the Option Plan), profit sharing plan, retirement agreement or other
employee compensation agreement. The Company is not aware that any officer or
key employee or consultant, or that any group of key employees or consultants,
of the Company intends to terminate their employment or service with the
Company, nor does the Company have a present intention to terminate the
employment or service of any of the foregoing. Subject to general principles
related to wrongful termination of employees, the employment of each employee of
the Company or any of its Subsidiaries is terminable at the will of the
employer.
2.20 Tax Returns, Payments, And Elections. The Company has timely filed
all material tax returns and reports (federal, foreign, state and local) as
required by law. These returns and reports are true and correct in all material
respects. The Company has paid all material taxes and other assessments due,
except those contested in good faith. The provision for taxes as shown in the
Financial Statements is adequate for taxes due or accrued as of the dates
thereof. The Company has not elected pursuant to the Internal Revenue Code of
1986, as amended (the "code"), to be treated as an S corporation or a
collapsible corporation pursuant to Section 1362(a) or Section 341(f) of the
Code, nor has it made any other elections pursuant to Code (other than elections
that relate solely to methods of accounting, depreciation, or amortization) that
would have a Material Adverse Effect. The Company has
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not had any tax deficiency proposed or assessed against it and has not has
executed any waiver of any statute of limitations on the assessment or
collection of any tax or governmental charge. None of the income tax returns of
the Company and none of its state income or franchise tax or sales or use of tax
returns has ever been audited by governmental authorities. Since the end of the
Company's last fiscal year, the Company has made adequate provisions on its
books of account for all taxes, assessments and governmental charges with
respect to its business, properties and operations.
2.21 Environmental And Safety Laws. To the Company's knowledge, the Company
is not in violation of any applicable statute, law or regulation relating to the
environment or occupational health and safety, which violation has had or could
reasonably be expected to have a Material Adverse Effect. To the Company's
knowledge, no material expenditures are or will be required in order to comply
with any such statute, law, or regulation.
3. REPRESENTATIONS AND WARRANTIES OF THE INVESTORS.
Each Investor hereby represents and warrants to the Company as of the date
of this Agreement that:
3.1 Authorization. Such Investor has full power and authority to enter
into this Agreement and the Registration Rights Agreement, and this Agreement
and the Registration Rights Agreement, when executed and delivered, will
constitute valid and legally binding obligations of such Investor.
3.2 Purchase Entirely For Own Account. The Series K Preferred Stock and
Warrants to be purchased by such Investor and the Common Stock issuable upon
conversion or exercise thereof (as the case may be) will be acquired for
investment for such Investor's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and such Investor
has no present intention of selling, granting any participating in or otherwise
distributing the same. Such Investor does not have any contract, undertaking,
agreement or arrangement with any person or entity to sell, transfer or grant a
participation to any third party with respect to any of such securities.
3.3 Reliance Upon Investors' Representations. Such Investor understands
that the Series K Preferred Stock and the Warrants are not, and any Common Stock
acquired on conversion or exercise thereof (as the case may be) may not be,
registered under the Securities Act on the ground that the sale provided for in
this Agreement and the issuance of securities hereunder is exempt from
registration under the Securities Act pursuant to Section 4(2) thereof, and
that the Company's reliance on such exemption is predicated on the Investors'
representations set forth herein. Such Investor realizes that the basis for the
exemption may not be present if, notwithstanding such representations, the
Investor has in mind merely acquiring shares of the Series K Preferred Stock,
Warrants, or Common Stock for a fixed or
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determinable period in the future, or for a market rise, or for sale if the
market does not rise. Such Investor has no such intention.
3.4 Receipt Of Information. Such Investor believes it has received all
the information such Investor considers necessary or appropriate for deciding
whether to purchase the Series K Preferred Stock and Warrants. Such Investor has
had an opportunity to ask questions and receive answers from the Company
regarding the terms and conditions of the offering of the Series K Preferred
Stock and Warrants and the business, properties, prospects and financial
condition of the Company and to obtain additional information (to the extent the
Company possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify the accuracy of any information furnished
to such Investor or to which such Investor had access. The foregoing, however,
does not limit or modify the representations and warranties of the Company in
Section 2 of this Agreement.
3.5 Investment Experience. Such Investor is experienced in evaluating and
investing in private placement transactions of securities of companies in a
similar stage of development to the Company and acknowledges that such Investor
is able to fend for itself, can bear the economic risk of such Investor's
investment and has such knowledge and experience in financial and business
matters that such Investor is capable of evaluating the merits and risks of the
investment in the Series K Preferred Stock. If other than an individual, such
Investor has not been organized for the purpose of acquiring the Series K
Preferred Stock.
3.6 Accredited Investor. Such Investor is an "accredited investor" as
defined in Rule 501 promulgated under the Securities Act.
3.7 Restricted Securities. Such Investor understands that the Series K
Preferred Stock, the Warrants, and the Common Stock issuable upon conversion or
exercise thereof (as the case may be) may not be sold, transferred or otherwise
disposed of without registration under the Securities Act or exemption
therefrom, and that in the absence of an effective registration statement
covering such securities or an available exemption from registration under the
Securities Act, such securities must be held indefinitely. In particular, such
Investor is aware that such securities may not be sold pursuant to Rule 144
promulgated under the Securities Act unless all of the conditions of that rule
are met. Among the conditions for use of Rule 144 may be the availability of
current information to the public about the Company. Such information is not now
available and the Company has no present plans to make such information
available.
4. DELIVERIES AT SIGNING.
The Company and the Investors have made the following deliveries to each
other upon the execution of this Agreement:
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4.1 Registration Rights Agreement. The Company and each Investor have
executed and delivered the Registration Rights Agreement.
4.2 Officer's Certificate. The President of the Company has delivered to
the Investors a certificate, dated as of the date of this Agreement, to the
effect that the representations and warranties of the Company contained in this
Agreement are true as of the date of this Agreement.
4.3 Secretary's Certificate. The Company has delivered to the Investors a
certificate of the Secretary of the Company, dated the date of this Agreement,
in form and substance satisfactory to the Investors.
4.4 Good Standing Certificate. The Company has delivered to the Investors
a long form good standing certificate with respect to the Company from the State
of Delaware dated as of a date not more than seven days prior to the date of
this Agreement.
4.5 Opinion of Counsel. Ropes & Xxxx, counsel to the Company, has
delivered to the Investors an opinion of counsel in form and substance
satisfactory to Xxxxxx & Dodge LLP.
5. MISCELLANEOUS.
5.1 Governing Law. This Agreement will be governed by and under the laws
of the State of Delaware.
5.2 Successors And Assigns. Except as otherwise expressly provided
herein, the provisions hereof will inure to the benefit of and be binding upon,
the successors, assigns, heirs executors and administrators of the parties
hereto.
5.3 Severability. In case any provision of this Agreement is invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions will not in any way be affected or impaired thereby.
5.4 Amendment And Waiver.
(a)Except as otherwise expressly provided, this Agreement may be
amended or modified only upon the written consent of the Company and Investors
representing at least 66 2/3% of the Commitments hereunder.
(a)Except as otherwise expressly provided, (1) the obligations of the
Company and the rights of the Investors under this Agreement may be waived by
any Investor only in writing and for all Investors only with the written consent
of Investors representing at least 66 2/3% of the Commitments hereunder, and (2)
the obligations of the Investors and the rights
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of the Company under this Agreement may be waived only with written consent of
the Company.
5.5 Delays Or Omissions. No delay or omission to exercise any right, power
or remedy accruing to any party hereto upon any breach, default or noncompliance
of any other party under this Agreement will impair any such right, power or
remedy, nor will it be construed to be a waiver of any such breach, default or
noncompliance, or any acquiescence therein, or of any similar breach, default or
noncompliance thereafter occurring. Any waiver, permit, consent or approval of
any kind or character on the part of any party hereto of any breach, default or
noncompliance under the Agreement must be in writing and will be effective only
to the extent specifically set forth in such writing. All remedies, either under
this Agreement, by law or otherwise afforded to the parties hereto, will be
cumulative and not alternative.
5.6 Notices. All notices required or permitted hereunder will be in
writing and will be deemed effectively given: (1) upon personal delivery to the
party to be notified, (2) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day, (3) five days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (4) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of delivery. All communications will be sent to the party
to be notified at the address as set forth on the signature pages hereof or at
such other address as such party may designate by 10 days' advance written
notice to the other parties hereto.
5.7 Attorneys' Fees. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
will be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement including, without limitation, reasonable fees and expenses of
attorneys and accountants, which will include, without limitation, all fees,
costs and expenses of appeals.
5.8 Titles And Subtitles. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
5.9 Counterparts. This Agreement may be executed in any number of
counterparts, each of which will be an original, but all of which together will
constitute one instrument.
5.10 Entire Agreement. This Agreement and the documents referred to herein
constitute the entire agreement among the parties and no party will be liable or
bound to any other party in any manner by any warranties, representations or
covenants except as specifically set forth herein or therein.
-13-
5.11 Finder's fees. Each party represents that it neither is nor will be
obligated for any finder's fee or commission in connection with this
transaction. Each Investor will indemnify and hold harmless the Company from any
liability for any commission or compensation in the nature of a finder's fee
(and the cost and expenses of defending against such liability or asserted
liability) for which the Investor or any of its officers, partners, employees,
or representatives is responsible. The Company will indemnify and hold harmless
each Investor from any liability for any commission or compensation in the
nature of a finder's fee (and the costs and expenses of defending against
liability or asserted liability) for which the Company or any of its officers,
employees, or representatives is responsible.
5.12 Expenses. The Company will pay all costs and expenses that it incurs
with respect to the negotiation, execution, delivery and performance of this
Agreement, and will pay the reasonable fees and expenses of Xxxxxx & Dodge LLP
in connection with this Agreement upon presentation of a written statement
therefor and up to $2500 of the reasonable fees and expenses of Xxxxxx Godward
in connection with this Agreement.
-14-
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: Seaflower BioVenture Fund II, LLC
COMMITMENT: $1,600,000.00
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices: c/o Seaflower Associates, Inc.
0000 Xxxxxx Xxxxxx, Xxx. 0000
Xxxxxxx, XX 00000-0000
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: J and L Xxxxxxxx Family, LLC
COMMITMENT: $100,000
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices: c/o Seaflower Associates, Inc.
0000 Xxxxxx Xxxxxx, Xxx. 0000
Xxxxxxx, XX 00000-0000
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: Seaflower Health & Technology Fund, LLC
COMMITMENT: $100,000
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices: c/o Seaflower Associates, Inc.
0000 Xxxxxx Xxxxxx, Xxx. 0000
Xxxxxxx, XX 00000-0000
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: Three Arch Bay
COMMITMENT: $500,000
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices:
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: Sweetwater Partners
COMMITMENT: $125,000
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices:
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: Xxxxxxx Xxxxxxxxxxx
COMMITMENT: $50,000
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices:
The parties have executed this Agreement as of the date first above written.
ACCESS RADIOLOGY CORPORATION
Signature:___________________________
Printed Name:________________________
Title:_______________________________
NAME OF INVESTOR: Xxxx Xxxxxx
COMMITMENT: $25,000
Signature:________________________
Printed Name: ____________________
Title:____________________________
Address For Notices:
