EXHIBIT 99.62
NOTE PURCHASE AGREEMENT
NOTE PURCHASE AGREEMENT (this "Agreement"), dated as of April 4, 2006,
by and between Vyteris Holdings (Nevada), Inc., a Nevada corporation ("Seller"),
and Xxxxxxx Xxxxx Specialty Group, LLC, a Delaware limited liability company
("Buyer").
W I T N E S S E T H:
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WHEREAS, Seller desires to issue to Buyer, and Buyer desires to
purchase from Seller, a convertible subordinated promissory note, substantially
in the form of EXHIBIT A hereto, in the principal amount of $500,000 (the
"Note");
WHEREAS, Seller has agreed to effect the registration of the shares of
Common Stock underlying the Note under the Securities Act of 1933, as amended,
pursuant to a registration statement substantially in the form of EXHIBIT B
hereto (the "Registration Rights Agreement"); and
WHEREAS, Seller, pursuant to that certain securities purchase
agreement dated as of August 19, 2005, as same may be amended from time to time
("Securities Purchase Agreement") issued a series of senior secured convertible
debentures, including debentures issued after the original issuance date (the
"Debentures") in the aggregate principal amount of $10.5 million (the "Senior
Debt").
NOW, THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth herein and for good and valuable consideration,
the receipt and sufficiency of which are hereby mutually acknowledged, the
parties agree as follows:
1. SALE AND PURCHASE OF THE NOTE
1.1. SALE AND PURCHASE. Subject to the terms and
conditions of this Agreement, at the Closing (as defined in Section 2.1 hereof),
Seller shall issue to Buyer, and Buyer shall purchase from Seller, for the
Purchase Price (as defined in Section 1.2(a) hereof), the Note.
1.2. PURCHASE PRICE AND PAYMENT.
(a) PURCHASE PRICE. The purchase price for the
Note shall be $500,000 (the "Purchase Price").
(b) PAYMENT OF PURCHASE PRICE. The Purchase
Price shall be paid to Seller by Buyer on the Closing Date (as defined in
Section 2.1 hereof) via federal funds wire transfer(s) of immediately available
funds, in accordance with written instructions provided to Buyer prior to the
date hereof.
2. CLOSING.
2.1. TIME AND PLACE. The closing of the sale and
purchase of the Note (the "Closing") shall be deemed to take place at the
offices of Xxxxxxx Krooks LLP, 655 Third Avenue, 20th Floor, New York, New York,
at 10:00 a.m., local time, on the date hereof, or at such later time or date as
Buyer and Seller may mutually agree in writing. The date upon which the Closing
shall occur is herein called the "Closing Date".
2.2. CLOSING DELIVERIES.
(a) SELLER DELIVERIES. At the Closing, Seller
shall deliver or cause to be delivered to Buyer the following:
(i) the duly executed Note;
(ii) the duly executed Registration
Rights Agreement; and
(iii) copies of any consents necessary
to effectuate this Agreement and to consummate the transactions contemplated
hereby.
(b) BUYER DELIVERY. At the Closing, Buyer shall
deliver or cause to be delivered to Seller the Purchase Price.
3. TERMS OF THE NOTE.
3.1. AMOUNT. The principal amount of the Note shall be
$500,000.
3.2. MATURITY. Unless otherwise converted into the
Conversion Shares (as defined in Section 3.4 hereof) in accordance with the
provisions hereof, the Note shall mature on December 1, 2008, unless such date
shall be otherwise extended in writing by Buyer, in its sole discretion (such
date, the "Maturity Date"). On the Maturity Date, unless, and to the extent,
converted into Conversion Shares in accordance with the provisions hereof, all
outstanding principal and any accrued and unpaid interest due and owing under
the Note shall be immediately paid by Seller.
3.3. INTEREST; INTEREST RATE; PAYMENT. (a) The Note shall
bear interest (other than interest accruing as a result of a failure by Seller
to pay any amount when due as set forth in clause (b) below) at a rate equal to
ten (10%) percent (the "Interest Rate") per annum on a 360-day year. Interest
(other than interest accruing as a result of a failure by Seller to pay any
amount when due as set forth in subparagraph (b) below) shall be due and payable
in cash semi-annually in arrears following the end of each semi-annual period,
commencing with the semi-annual period ended June 30, 2006, pro rated for
partial periods; PROVIDED, HOWEVER, that any interest accruing on overdue
amounts pursuant to subparagraph (b) of this Section 3.3 shall be payable on
demand.
(b) If all or a portion of the principal amount of
the Note or any interest payable thereon shall not be repaid when due whether on
the applicable repayment date, by acceleration or otherwise, such overdue
amounts shall bear interest at a rate per annum that is three percent (3%) above
the Interest Rate (I.E., 13%) from the date of such non-payment until such
amount is paid in full (as well after as before judgment).
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(c) All payments to be made by Seller hereunder or
pursuant to the Note shall be made, without setoff or counterclaim, in lawful
money of the United States by check or wire transfer in immediately available
funds.
3.4. CONVERSION. (a) Subject to Sections 3.4(b) and 3.5
hereof, at any time prior to the Maturity Date, the Seller shall have the option
to convert the entire principal and interest accrued and owing on the Note, or
any portion of the principal and/or interest thereof, into shares (the
"Conversion Shares") of Common Stock at the Conversion Price. For purposes
hereof, "Conversion Price" shall mean $2.40 per share; PROVIDED, that if at any
time on or after the issuance date of the Note, Seller subdivides (by any stock
split, stock dividend, recapitalization, reorganization, reclassification or
otherwise) its shares of Common Stock into a greater number of shares, then
after the date of record for effecting such subdivision, the Conversion Price
shall be proportionately reduced, or if Seller combines (by reverse stock split,
recapitalization, reorganization, reclassification or otherwise) its shares of
Common Stock into a smaller number of shares, the Conversion Price shall be
proportionately increased.
Upon conversion, Buyer shall be entitled to receive the number of Conversion
Shares calculated by dividing the amount being converted by the Conversion
Price. No fractional shares of Conversion Shares shall be issued upon
conversion. In lieu of any fractional shares to which Buyer would otherwise be
entitled, Seller shall pay cash in an amount equal to such fraction multiplied
by the Conversion Price. The Note shall not be subject to automatic conversion
or to any conversion at the option of Seller.
(b) Notwithstanding the provision of Section 3.4(a), if an equity security or
other derivative security convertible or exercisable into an equity security of
the Company ("Applicable Security") is sold in connection with a Qualified
Financing (as hereinafter defined) at any time prior to payment in full of the
principal balance of the Note, all of the principal and interest due thereunder
shall automatically become converted into the Applicable Security with the same
rights and privileges granted to investors in the Qualified Financing. The
number of Applicable Securities received upon conversion pursuant to this
Section 3(b) shall be determined by dividing the aggregate principal amount due
under the Note, together with any accrued but unpaid interest to the date of
conversion, by the price per Applicable Security paid in the Qualified
Financing. For the purposes of the Note, a "Qualified Financing" shall mean the
Company's next private financing of Applicable Securities to investors (i)
yielding aggregate gross proceeds (exclusive of conversion of the Note) to the
Company of at least $500,000 and (ii) which does not invoke or trigger the
provisions of Section 4(b) of the Debentures or Section 6(c) of the Warrants (as
such term is defined in the Securities Purchase Agreement.
3.5. CONVERSION PROCEDURES. In order to exercise the
conversion rights set forth in Section 3.4(a) hereof, Buyer shall surrender the
Note, appropriately endorsed, to Seller at Seller's principal office,
accompanied by written notice to Seller setting forth the amount of principal
and interest to be converted, the name or names (with address(es)) in which the
Conversion Shares issuable upon such conversion shall be issued and registered
on the books of Seller. For purposes hereof, the "Conversion Date" shall be
deemed to be the date the Note and notice is received by Seller for conversion.
Within five (5) business days after the Conversion Date, Seller shall deliver to
Buyer (i) a stock certificate for the Conversion Shares or (ii) a notice
certified by Seller's Secretary that the Conversion Shares due on such
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conversion have been issued to and registered on the books of Seller in the name
or names specified by Buyer. In the case of conversion of less than the entire
principal of and interest under the Note, Seller shall cancel said Note and
shall execute and deliver a new Note of like tenor for the unconverted amount of
the Note dated the date of execution by Seller upon initial issuance of the Note
notwithstanding any subsequent substitution.
3.6. SUBORDINATION. The Note is expressly and fully
subordinated, as to payment and liquidation, to the payment in full of the
Debentures and the Obligations (as such term is defined in the Securities
Purchase Agreement) and the holder of the Note acknowledges and agrees that the
Seller is expressly restricted from pre-paying any amounts in respect of the
principal of the Note (upon acceleration or otherwise) until payment in full of
the Debentures. The holder of this Note shall not commence any judicial or other
collection efforts or exercise any other remedies prior to the date that is
ninety-one (91) days following the payment in full of the Debentures. The Note
is, and is intended to be, "Subordinated Debt" as such term is defined in the
Securities Purchase Agreement.
3.7. PREPAYMENT RIGHTS UPON MERGER, CONSOLIDATION, ETC. (a)
If, prior to the Conversion Date, but subject to the provisions of Section 3.6
above, Seller proposes to consolidate with, or merge into, another corporation
or entity, or to effect any sale or conveyance to another corporation or entity
of all or substantially all of the assets of Seller, or effect any other
corporate reorganization, in which the stockholders of the Seller immediately
prior to such consolidation, merger or reorganization own capital stock of the
entity surviving such merger, consolidation or reorganization representing less
than fifty (50%) percent of the combined voting power of the outstanding
securities of such entity immediately after such consolidation, merger or
reorganization (collectively, a "Liquidation Event"), then Seller shall provide
Buyer with at least ten (10) days' prior written notice of any such proposed
action, and Buyer will, at its option, have the right to demand immediate
prepayment of all amounts due and owing under the Note. Buyer will give Seller
written notice of such demand within five (5) days after receiving notice of the
Liquidation Event. All amounts (including all accrued and unpaid interest) due
and owing under the Note shall be paid by Seller to Buyer within five (5) days
from the date of such written notice via federal funds wire transfer(s) of
immediately available funds, in accordance with written instructions to be
provided to Seller by Buyer within at least two (2) business days after giving
Seller such written notice. The provisions of this Section 3.7(a) shall
similarly apply to successive consolidations or mergers.
(b) Except as set forth in Sections 3.6, 3.7(a) and 9
hereof, Seller shall not prepay prior to the Maturity Date all or part of this
Note without the express written consent of Buyer.
3.8 INTENTIONALLY DELETED
3.9 ASSURANCES WITH RESPECT OF CONVERSION RIGHTS. Seller
shall not, by amendment of its Certificate of Incorporation or By-laws or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms to be observed
or performed hereunder by Seller but shall at all times in good faith assist in
the carrying out of all the provisions of this Agreement and in taking of all
such actions as may be necessary or appropriate in order to protect the
conversion rights of Buyer against impairment.
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4. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller
hereby represents and warrants to Buyer as follows:
4.1 DUE ORGANIZATION AND QUALIFICATION. Seller is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Nevada. Seller has all requisite power and authority to own,
lease and operate its assets and properties and to carry on its business as
presently conducted and as presently contemplated. Seller is duly qualified to
transact business and is in good standing in each jurisdiction in which the
nature of its business or the locations of its property requires such
qualification, except where the failure to do so would not have a material
adverse effect on Seller's business, operations, assets or condition (financial
or otherwise).
4.2 POWER AND AUTHORITY. Seller has the requisite
corporate power and authority to execute and deliver this Agreement and all
other agreements contemplated by this Agreement (including, without limitation,
the Note and the Registration Rights Agreement) and to perform its obligations
hereunder and thereunder. The execution, delivery and performance of this
Agreement and all other agreements contemplated by this Agreement have been duly
authorized by all necessary corporate action on the part of Seller. This
Agreement has been duly executed and delivered by Seller and is the valid and
binding obligation of Seller, enforceable against Seller in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
moratorium, insolvency, reorganization or other similar laws now or hereafter in
effect generally affecting the enforcement of creditors' rights, specific
performance, injunctive or other equitable remedies. When executed and delivered
by Seller at the Closing, each of the Note and the Registration Rights Agreement
will be the valid and binding obligation of Seller, enforceable against Seller
in accordance with its terms, except as such enforceability may be limited by
bankruptcy, moratorium, insolvency, reorganization or other similar laws now or
hereafter in effect generally affecting the enforcement of creditors' rights,
specific performance, injunctive or other equitable remedies.
4.3. CAPITALIZATION. The capitalization of the Seller as of
the date of this Agreement, including its authorized capital stock, the
number of shares issued and outstanding, the number of shares issuable and
reserved for issuance pursuant to the Seller's stock option plans and
agreements, the number of shares issuable and reserved for issuance pursuant to
securities (other than the Note) exercisable for, or convertible into or
exchangeable for any shares of Common Stock and the number of shares initially
to be reserved for issuance upon conversion of the Note is set forth on Schedule
4.3 hereto. All issued and outstanding shares of capital stock of the Seller
have been validly issued, fully paid and non-assessable. Except as disclosed on
Schedule 4.3 hereto, the Seller owns all of the capital stock of each
subsidiary, which capital stock is validly issued, fully paid and
non-assessable, and no shares of the capital stock of the Seller or any of the
subsidiaries are subject to preemptive rights or any other similar rights of the
shareholders of the Seller or any such subsidiary or any liens created by or
through the Seller or any such subsidiary. Except as disclosed on Schedule 4.3
or as contemplated herein, there are no outstanding options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into or exercisable or
exchangeable for, any shares of capital stock of the Seller or any of the
subsidiaries, or arrangements by which the Seller or any of the subsidiaries is
or may become bound to issue additional shares of capital stock of the Seller or
any of the subsidiaries (whether pursuant to anti-dilution, "reset" or other
similar provisions). Schedule 4.3 identifies all Debt of the Seller and the
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subsidiaries currently outstanding in excess of $100,000 individually or in the
aggregate as of the date hereof.
4.4. FINANCIAL STATEMENTS; OTHER INFORMATION. Seller has
filed with the Securities and Exchange Commission ("Commission") all reports,
schedules, registration statements and definitive proxy statements that Seller
was required to file with Commission on or after December 31, 2004
(collectively, the "SEC DOCUMENTS"). Seller is not aware of any event occurring
or expected to occur as of the date of this Agreement (other than the
transactions effected hereby) that would require the filing of, or with respect
to which Seller intends to file, a Form 8-K after the date of this Agreement.
Each SEC Document, as of the date of the filing thereof with the Commission (or
if amended or superseded by a filing prior to the date of this Agreement, then
on the date of such amending or superseding filing), complied in all material
respects with the requirements of the Securities Act of 1933, as amended
("Securities Act") or Securities Exchange Act of 1934, as amended ("Exchange
Act"), as applicable, and the rules and regulations promulgated thereunder and,
as of the date of such filing (or if amended or superseded by a filing prior to
the date of this Agreement, then on the date of such filing), such SEC Document
(including all exhibits and schedules thereto and documents incorporated by
reference therein) did not contain an untrue statement of material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. All documents that are required to be filed as exhibits to the
SEC Documents have been filed as required. Except as set forth in Schedule 4.4,
Seller has no liabilities, contingent or otherwise, other than liabilities
incurred in the ordinary course of business that, under GAAP, are not required
to be reflected in the financial statements included in Schedule 4.4. Except as
set forth in Schedule 4.4, as of their respective dates, the financial
statements of Seller included in the SEC Documents complied as to form in all
material respects with applicable accounting requirements and the published
rules and regulations of the Commission with respect thereto. The financial
statements included in the SEC Documents have been and will be prepared in
accordance with GAAP consistently applied at the times and during the periods
involved (except (i) as may be otherwise indicated in such financial statements
or the notes thereto, (ii) in the case of unaudited interim statements, to the
extent they may exclude footnotes or may be condensed or summary statements, or
(iii) as set forth in the SEC Documents), and fairly present in all material
respects the financial position of Seller as of the dates thereof and the
results of its operations and cash flows for the periods then ended (subject, in
the case of unaudited statements, to normal year-end adjustments).
4.5. AUTHORIZATION OF THE NOTE AND CONVERSION SHARES. All
corporate action on the part of Seller necessary for the authorization,
issuance, sale and/or delivery of the Note and the capital stock issuable upon
conversion of the Note (the "Conversion Shares") has been taken and when issued,
sold and delivered in accordance with this Agreement and/or the Note, the
Conversion Shares will be validly issued and outstanding, fully paid and
nonassessable and not subject to preemptive, first refusal or any other similar
rights of any stockholder of Seller or others.
4.6 COMPLIANCE WITH LAWS. To its knowledge, Seller is in
compliance in all material respects with all Federal, state, local and foreign
laws, statutes, ordinances, regulations, orders, judgments, injunctions, awards
or decrees (collectively, "Laws") applicable to it or any of its properties or
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operations. Seller has not received any notice of material violation or alleged
material violation of any Law by it. Seller has all material licenses, permits,
orders and approvals of Federal, state, local and foreign governmental or
regulatory bodies necessary for the conduct of its business and operations as
presently conducted.
4.7 NO BREACH; CONSENTS. Except as set forth on SCHEDULE
4.7 hereto, the execution, delivery and performance of this Agreement by Seller
and the consummation by Seller of the transactions contemplated hereby will not
(i) result in any lien, pledge, mortgage, security interest, claim, lease,
charge, option, easement, servitude or other encumbrance whatsoever
(collectively, "Liens") upon any of the property of Seller (other than in favor
of Buyer) or (ii) violate, conflict with or breach any of the terms and
conditions of, result in a material modification of, accelerate or trigger the
rights of any person under, or constitute (or with notice or lapse of time or
both would constitute) a default under (a) any material instrument, contract or
other agreement to which Seller is a party or by or to which it or any of its
properties is bound or subject; (b) Seller's Certificate of Incorporation or
By-laws (and all amendments thereto up through the date hereof); or (c) any Law
applicable to Seller or any of its properties or operations. Except as set forth
on SCHEDULE 4.7, no consent, approval or authorization of, or declaration or
filing with, any governmental authority, stockholder of Seller or other person
is required on the part of Seller in connection with the execution, delivery or
performance of this Agreement or the consummation by it of the transactions
contemplated hereby.
4.8 LITIGATION. Except as set forth on SCHEDULE 4.8
hereto, there are no material suits or actions, administrative, arbitration or
other proceedings or governmental investigations pending or, to Seller's
knowledge, threatened against or affecting Seller or any of its properties or
assets. There are no judgments, orders, injunctions, decrees or awards against
Seller that are not satisfied or remain outstanding.
4.9. BROKERS. Neither Seller nor any of Seller's
officers, directors, employees or stockholders has employed any broker or finder
in connection with the transactions contemplated by this Agreement and no fee is
or will be due and owing to any broker or finder in connection with the
transactions contemplated by this Agreement.
4.10 INTELLECTUAL PROPERTY. All of Seller's (i)
trademarks, trade names, registered trademarks, trademark applications, service
marks, registered service marks and service xxxx applications, (ii) patents and
patent applications, and (iii) licenses with respect to the use of patents or
trademarks owned by other parties, are set forth on SCHEDULE 4.10 hereto. Except
as set forth on SCHEDULE 4.10, there is not pending nor, to Seller's knowledge,
threatened any claim, suit or action contesting or challenging the rights of
Seller in or to any of the material item of intellectual property owned or used
by Seller in the conduct of its business (the "Intellectual Property") or the
validity of any of the Intellectual Property. To Seller's knowledge, there is no
infringement upon or unauthorized use of any of the Intellectual Property by any
third party. No officer, director, equityholder or affiliate of Seller nor any
of their respective associates has any right to or interest in any of the
Intellectual Property, including, without limitation, any right to payments (by
royalty or otherwise) in respect of any use or transfer thereof.
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4.11 PERFORMANCE OF AGREEMENTS. Except as set forth on
SCHEDULE 4.11 hereto, no default by Seller exists in the due performance under
any material agreement to which Seller is a party or to which any of its assets
is subject.
4.12 NO WAIVER OF PRIOR OR FUTURE DEFAULTS. Seller hereby
acknowledges and agrees that this Agreement and Buyer's purchase from Seller of
the Note, pursuant to the terms and conditions hereof, shall not constitute or
operate as a waiver or release of any default, or any future defaults, under the
Default Notes.
5. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer
hereby represents and warrants to Seller as follows:
5.1 DUE ORGANIZATION. Buyer is a duly organized legal
entity, validly existing and in good standing under the laws of the state of its
organization.
5.2 POWER OF BUYER. Buyer has the requisite company
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement has been duly executed and delivered by
Buyer and is the valid and binding obligation of Buyer, enforceable against
Buyer in accordance with its terms, except as such enforceability may be limited
by bankruptcy, moratorium, insolvency, reorganization or other similar laws
generally affecting the enforcement of creditors' rights, specific performance,
injunctive or other equitable remedies.
5.3 NO BREACH. The execution, delivery and performance
of this Agreement by Buyer and the consummation by Buyer of the transactions
contemplated hereby will not violate, conflict with or otherwise result in the
breach of any of the terms and conditions of, result in a material modification
of or constitute (or with notice or lapse of time or both would constitute) a
default under (i) any of the organizational documents of Buyer; (ii) any
material instrument, contract or other agreement to which Buyer is a party or by
or to which it or any of its properties is bound or subject; or (iii) any Law
applicable to Buyer or any of its properties or operations.
5.4 GOVERNMENTAL AND OTHER CONSENTS. No consent,
approval or authorization of, or declaration or filing with, any governmental
authority or other person is required on the part of Buyer in connection with
the execution, delivery and performance of this Agreement by it or the
consummation of the transactions contemplated hereby.
5.5 INVESTMENT REPRESENTATIONS. Buyer is acquiring the
Note (the "Securities"), and any capital stock issuable upon exercise of the
Securities, for Buyer's own account, for investment and not with a view to, or
for sale in connection with, any distribution of such securities or any part
thereof. Buyer (i) has such knowledge and experience in financial and business
affairs that it is capable of evaluating the merits and risks involved in
purchasing the Securities, (ii) is able to bear the economic risks involving in
purchasing the Securities, (iii) is an "accredited investor" as defined in Rule
501(a) of Regulation D promulgated under the Securities Act and (iv) has had the
opportunity to ask questions of, and receive answers from, Seller and persons
acting on Seller's behalf concerning Seller's business, management, and
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financial affairs and the terms and conditions of the Securities. Buyer's state
of residence is New York.
5.6. NO BROKER. Buyer has not employed any broker or
finder in connection with the transactions contemplated by this Agreement.
6. COVENANTS AND AGREEMENTS.
6.1 PRE-CLOSING COVENANTS AND AGREEMENTS. The parties
hereto covenant and agree to perform or take any and all such actions to
effectuate the following from the date hereof until the earlier of the Closing
Date or the termination of this Agreement:
(a) FURTHER ASSURANCES. Each of the parties shall, prior
to or at the Closing, as may be appropriate, execute such documents and other
papers and take such other further actions as may be reasonably required to
carry out the provisions hereof and effectuate the transactions contemplated
hereby, and in the Note and the Registration Rights Agreement. Each party shall
use its best efforts to fulfill or obtain the fulfillment of the conditions to
its obligation to effect the Closing, including promptly obtaining any consents
required in connection herewith.
(b) ADDITIONAL DISCLOSURE. Seller shall promptly notify
Buyer of, and furnish Buyer with, any information it may reasonably request with
respect to the occurrence of any event or condition or the existence of any fact
that would cause any of the conditions to Buyer's obligation to consummate the
transactions contemplated by this Agreement not to be fulfilled.
6.2 POST-CLOSING COVENANTS AND AGREEMENTS. Buyer and
Seller covenant and agree from and after the Closing Date to perform or take the
following actions:
(a) RESERVE FOR CONVERSION SHARES. Seller shall at all
times reserve and keep available out of its authorized but unissued shares of
Common Stock or other securities for the purpose of issuing Common Stock or
other securities upon the conversion of the Note. If at any time the number of
authorized but unissued shares of Common Stock or other securities shall not be
sufficient to satisfy the conversion of the Note, if any, Seller shall forthwith
take such corporate action as may be necessary to increase its authorized but
unissued shares of Common Stock or other securities to such number of shares as
shall be sufficient for such purpose. If any capital reorganization or any
Liquidation Event of Seller shall be effected in such a way that holders of
Common Stock shall be entitled to receive capital stock, securities or assets
with respect to or in exchange for Common Stock, then, as a condition of such
reorganization, reclassification or Liquidation Event, lawful and adequate
provisions shall be made whereby the holder of the Note shall thereafter, upon
conversion, have the right to receive such shares of capital stock, securities
or assets as may be issued or payable with respect to or in exchange for the
number of outstanding shares of such Common Stock into which the Note held at
the time of such capital reorganization, reclassification or Liquidation Event
is convertible.
7. CONDITIONS PRECEDENT TO THE OBLIGATION OF BUYER TO
CLOSE.
7.1 CLOSING. The obligation of Buyer to complete the
Closing is subject to the fulfillment on or prior to the Closing Date of all of
the following conditions, any one or more of which may be waived by Buyer in
writing:
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(a) AGREEMENTS AND CONDITIONS. On or before the Closing
Date, Seller shall have complied with and duly performed and satisfied in all
material respects all agreements and conditions on its part to be complied with
and performed by such date pursuant to this Agreement.
(b) CONSENTS. Seller shall have obtained any consents
necessary to effectuate this Agreement and to consummate the transactions
contemplated hereby and delivered copies thereof to Buyer.
(c) NOTE. Seller shall have duly executed and delivered
to Buyer the Note.
(d) REGISTRATION RIGHTS AGREEMENT. Seller shall have
duly executed and delivered to Buyer the Registration Rights Agreement.
8. CONDITIONS PRECEDENT TO THE OBLIGATION OF SELLER TO
CLOSE.
8.1 CLOSING. The obligation of Seller to complete the
Closing is subject to the fulfillment on or prior to the Closing Date of all of
the following conditions, any one or more of which may be waived by Seller in
writing:
(a) AGREEMENTS AND CONDITIONS. On or before the Closing
Date, Buyer shall have complied with and performed and satisfied in all material
respects all agreements and conditions to be complied with and performed by such
date pursuant to this Agreement.
(b) PAYMENT OF PURCHASE PRICE. Buyer shall have paid to
Seller the Purchase Price.
(c) REGISTRATION RIGHTS AGREEMENT. Buyer shall have duly
executed and delivered to Seller the Registration Rights Agreement.
9. EVENTS OF DEFAULT. If any of the following events
(each, an "Event of Default") shall occur and be continuing:
(i) Seller shall fail to pay any amount payable under
the Note within three (3) business days after such payment becomes due in
accordance with the terms thereof;
(ii) Seller shall fail to pay when due (following the
expiration of applicable notice and cure periods, if any), whether upon
acceleration, prepayment obligation or otherwise, any indebtedness and/or other
sums payable, individually or in the aggregate, involving an amount in excess of
$100,000;
(iii) Any representation or warranty made or deemed made
by Seller herein or in any other agreement, certificate or instrument
contemplated by this Agreement or that is contained in any certificate, document
or financial or other statement furnished at any time under or in connection
with this Agreement shall have been incorrect in any material respect on or as
of the date made or deemed made;
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(iv) Seller shall default, in any material respect, in
the observance or performance of any other agreement contained in this Agreement
or any other agreement or instrument contemplated by this Agreement, and such
default shall continue unremedied for a period of twenty (20) days after notice
to Seller of such default;
(v) Seller shall substantially curtail, alter, modify or
change its business operations, as reasonably determined by Buyer; or
(vi) (a) Seller shall commence any case, proceeding or
other action (x) under any existing or future law of any jurisdiction, domestic
or foreign, relating to bankruptcy, insolvency, reorganization, conservatorship
or relief of debtors, seeking to have an order for relief entered with respect
to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (y) seeking
appointment or a receiver, trustee, custodian, conservator or other similar
official for it or for all or any substantial part of its assets, or Seller
shall make a general assignment for the benefit of its creditors; or (b) there
shall be commenced against Seller any case, proceeding or other action of a
nature referred to in clause (a) above that (A) results in the entry of an order
for relief of any such adjudication of appointment or (B) remains undismissed,
undischarged or unbonded for a period of sixty (60) days; or (c) there shall be
commenced against Seller any case, proceeding other action seeking issuance of a
warrant of attachment, execution, distrait or similar process against all or any
substantial part of its assets that results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or bonded
pending appeal within sixty (60) days from the entry thereof; or (d) Seller
shall take any action in furtherance of, or indicating its consent to, approval
of, or acquiescence in any of the acts set forth in clauses (a), (b) or (c)
above; or (e) Seller shall generally not, or shall be unable to, or shall admit
in writing its inability to, pay its debts as they become due,
then, and in any such event, but in all events subject to the
provisions of Section 3.6 above, (x) if such event is an Event of Default
specified in subsection (vi) above of this Section 9 with respect to Seller,
automatically the Note (with all accrued and unpaid interest thereon) and all
other amounts owing under this Agreement and the Note shall immediately become
due and payable, and (y) if such event is any other Event of Default, Buyer may,
by written notice to Seller, declare the Note (with all accrued and unpaid
interest thereon) and all other amounts owing under this Agreement and the Note
to be due and payable forthwith, whereupon the same shall immediately become due
and payable. Except as expressly provided above in this Section 9, presentation,
demand, protest and all other notices of any kind are hereby expressly waived by
Seller.
10. MISCELLANEOUS.
10.1. PUBLICITY. Subject to the requirements of the
Federal securities laws, no publicity release or announcement concerning this
Agreement or the transactions contemplated hereby shall be issued without
advance approval of the form and substance thereof by Buyer and Seller jointly.
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10.2 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been given when
delivered by hand or by facsimile transmission, when telexed, or upon receipt
when mailed by registered or certified mail (return receipt requested), postage
prepaid, to the parties at the following addresses (or at such other address for
a party as shall be specified by like notice):
(i) If to Seller:
Vyteris Holdings (Nevada), Inc.
00-00 Xxxxxxx Xxxxx
Xxxx Xxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (000) 000-0000
With a copy (which copy shall not constitute notice)
to:
Xxxxxxxxxx Xxxxxxx PC
00 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Facsimile: (000) 000-0000
(ii) If to Buyer:
Xxxxxxx Xxxxx Specialty Group, LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxx, Esq.
Facsimile: (000) 000-0000
With a copy (which copy shall not constitute notice)
to:
Xxxxxxx Xxxxxx LLP
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
10.3. ENTIRE AGREEMENT; EXERCISE OF RIGHTS. (a) This
Agreement (including the Schedules and Exhibits hereto) and the other Loan
Documents (as defined in Section 10.6 hereof) embody the entire agreement and
understanding of the parties hereto with respect to the subject matter hereof.
No amendment of any provision of this Agreement shall be effective unless it is
in writing and signed by each of the parties hereto and no waiver of any
provision of this Agreement, nor consent to any departure by either party from
it, shall be effective unless it is in writing and signed by the affected party,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
(b) No failure on the part of a party to exercise, and
no delay in exercising, any right under this Agreement, or any agreement
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contemplated hereby, shall operate as a waiver hereof by such party, nor shall
any single or partial exercise of any right under this Agreement, or any
agreement contemplated hereby, preclude any other or further exercise thereof or
the exercise of any other right.
10.4. GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely within such jurisdiction.
10.5. EXPENSES. Seller and Buyer shall, subject to the
immediately succeeding sentence, bear their respective expenses incurred in
connection with the negotiation, preparation, execution and performance of this
Agreement and the consummation of the transactions contemplated hereby,
including, without limitation, all fees and expenses of agents, representatives,
counsel, brokers or finders, and accountants.
10.6 TRANSFERABILITY. Subject to securities laws
restrictions of general applicability, this Agreement, the Note and the
Registration Rights Agreement (collectively, the "Loan Documents") and all
rights hereunder and thereunder are freely and separately transferable and
assignable, in whole or in part, by Buyer. The foregoing transferees and
assignees shall be entitled to the rights provided in the Loan Documents. Seller
may not assign or delegate any of its obligations under the Loan Documents
without the prior written consent of Buyer. For purposes hereof, a sale or
exchange by Seller of all or substantially all of its assets shall constitute an
assignment/delegation requiring Buyer's prior written consent.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Note
Purchase Agreement on the date first above written.
XXXXXXX XXXXX SPECIALTY GROUP, LLC
By:____________________________________
Name:
Title:
VYTERIS HOLDINGS (NEVADA), INC.
By:____________________________________
Name:
Title:
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EXHIBIT 99.62
EXHIBIT A
Form of Note
EXHIBIT B
Form of Registration Rights Agreement
SCHEDULES
