EXHIBIT 10.1
NORTH AMERICAN SCIENTIFIC, INC.
COMMON STOCK PURCHASE AGREEMENT
NOVEMBER 10, 1997
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "AGREEMENT") is made as of
November 10, 1997 by and among NORTH AMERICAN SCIENTIFIC, INC., a Delaware
corporation (the "COMPANY"), with its principal office at 0000 Xxxxxxxxx Xxxxxx,
Xxxxx Xxxxxxxxx, Xxxxxxxxxx 00000, and the persons listed on the Schedule of
Investors attached hereto as EXHIBIT A (the "PURCHASERS").
SECTION 1. AUTHORIZATION AND SALE OF SHARES
1.1 AUTHORIZATION. The Company has authorized the sale and issuance of up
to 1,000,000 shares of its common stock, par value $0.01 per share ("COMMON
STOCK"), pursuant to this Agreement.
1.2 SALE OF SHARES. Subject to the terms and conditions of this
Agreement, the Company agrees to issue and sell to each Purchaser and each
Purchaser severally agrees to purchase from the Company on the Closing Date
hereinafter defined, the number of shares of Common Stock set forth opposite
each Purchaser's name on EXHIBIT A (the "SHARES") for a purchase price (the
"PURCHASE PRICE") $18.00 per share.
SECTION 2. CLOSING DATE; DELIVERY
2.1 CLOSING DATE. The closing of the purchase and sale of the Shares (the
"CLOSING") shall be held at the offices of X'Xxxxxx & Xxxxxx, 00 X. XxXxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx at 8:00 a.m. (Pacific Daylight Time), on
November 13, 1997 or at such other time and place upon which the Company and
Purchasers purchasing the majority of the Shares shall agree. The date of the
Closing is hereinafter referred to as the "CLOSING DATE".
2.2 DELIVERY. At the Closing, the Company shall deliver to each Purchaser
a certificate, registered in the Purchaser's name as shown on EXHIBIT A,
representing the number of Shares to be purchased by the Purchaser. Such
delivery shall be against payment of the Purchase Price therefor by wire
transfer of immediately available funds in the amount set forth opposite such
Purchaser's name on EXHIBIT A to a bank account designated in writing by the
Company to each Purchaser at least two (2) business days prior to Closing Date.
Each Purchaser shall only be obligated to pay the Purchase Price of the Shares
purchased by it.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants as of the date hereof to, and
covenants with, the Purchasers as follows:
3.1 ORGANIZATION AND STANDING. The Company has been duly incorporated and
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has full corporate power and authority to own
or lease its properties and conduct its business presently and as proposed to be
conducted and as described in the Confidential Offering Memorandum, dated
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November 3, 1997, as amended by that Addendum dated November 7, 1997 (together
with the attachments thereto, the "MEMORANDUM") and is duly qualified as a
foreign corporation and in good standing in all jurisdictions in which the
character of the property owned or leased or the nature of the business
transacted by it makes qualification necessary (except where the failure to be
so qualified would not have a Material Adverse Effect (as defined below) on the
business, properties, financial condition or results or operations of the
Company). Except for the Company's ownership of all the outstanding shares of
North American Scientific, Inc., a California corporation, and certain shares of
RadioMed Corporation ("RADIOMED") held on behalf of the Company by L. Xxxxxxx
Xxxxxx and Xxxxx X. Xxxxxxxxx, the Company has no subsidiaries or equity
interest in any other entity.
3.2 CORPORATE POWER; AUTHORIZATION. The Company has all requisite
corporate power, and has taken all requisite corporate action, to execute and
deliver this Agreement, to sell and issue the Shares and to carry out and
perform all of its obligations under this Agreement. This Agreement constitutes
the legal, valid and binding obligation of the Company, enforceable in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or affecting
the enforcement of creditors' rights generally, (ii) as limited by equitable
principles generally and (iii) as to those provisions of Section 7.3 hereof
relating to indemnity or contribution. The execution and delivery of this
Agreement does not, and the performance of this Agreement and the compliance
with the provisions hereof and the issuance, sale and delivery of the Shares by
the Company will not conflict with, or result in a breach or violation of the
terms, conditions or provisions of, or constitute a default (or an event that
with notice or lapse of time or both would constitute a default) under, or
result in the creation or imposition of any lien pursuant to the terms of, the
Company's certificate of incorporation (the "CERTIFICATE OF INCORPORATION") or
its bylaws (the "BYLAWS") or, to the Company's knowledge, any statute, law, rule
applicable to the Company or regulation or any state or Federal order, judgment
or decree applicable to the Company or any indenture, mortgage, lease or other
agreement or instrument to which the Company or any of its properties is
subject, except as would not individually or in the aggregate have a material
adverse effect on, or result in a material adverse change in, the business,
properties, operation, condition (financial or other) or results of operations
of the Company, taken as a whole, or render this Agreement, or any portion
hereof, invalid or unenforceable or impair in any material respect the ability
of the Company to perform fully its obligations hereunder (any of the foregoing
shall be referred to herein as a "MATERIAL ADVERSE EFFECT").
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares have been duly
authorized and, when issued and paid for in compliance with the provisions of
this Agreement, will be validly issued, fully paid and nonassessable and will
conform to the description thereof contained in the Registration Statement (as
defined below). The issuance and delivery of the Shares is not subject to
preemptive, co-sale, right of first refusal or any other similar rights of the
stockholders of the Company or any liens or encumbrances. Except for certain
"piggyback" registration rights granted to X.X. Xxxxxxxx & Co., Inc.
("XXXXXXXX") pursuant to that Letter Agreement dated as of December 11, 1996
between the Company and Xxxxxxxx, the Company has not granted any presently
effective registration rights with respect to its securities other than the
registration rights set forth herein. No further approval or authority of the
stockholders or Board of Directors of the Company will be required for the
issuance and sale of the Shares.
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3.4 MEMORANDUM; SEC DOCUMENTS; FINANCIAL STATEMENTS. Each complete or
partial statement, report, or proxy statement included in the Memorandum is a
true and complete copy of or excerpt from such document as filed by the Company
with the Securities and Exchange Commission (the "SEC"). The Company has filed
in a timely manner all documents that the Company was required to file with the
SEC under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of 1934,
as amended (the "EXCHANGE ACT"), during the twelve (12) months preceding the
date of this Agreement. As of their respective filing dates, all documents
filed by the Company with the SEC (the "SEC DOCUMENTS") complied in all material
respects with the requirements of the Exchange Act. Neither the Memorandum nor
any of the SEC Documents as of their respective dates contained any untrue
statement of material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading. The financial
statements of the Company included in the SEC Documents and the Memorandum (the
"FINANCIAL STATEMENTS") comply as to form in all material respects with
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto. The Financial Statements have been prepared in
accordance with generally accepted accounting principles consistently applied
and fairly present the financial position of the Company at 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, recurring
adjustments). There is no material commitment of the Company which is not
reflected in the Financial Statements except commitments made in the ordinary
course of business. There have not been any changes in the assets, liabilities,
financial condition or operations 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.
3.5 INTELLECTUAL PROPERTY. The Company owns or possesses adequate rights
to use all patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as presently conducted and proposed to
be conducted as described in the Memorandum. Except as disclosed under
"BUSINESS - Legal Proceedings" in the Memorandum, the Company has not received
any notice of, nor has any knowledge of, any infringement of or conflict with
asserted rights of others with respect to any patent, patent right, invention,
trade secret or know-how that, individually or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a Material Adverse
Effect.
3.6 PROPERTIES. The Company has good and valid title to all of the
properties and assets reflected as owned in the Financial Statements, free and
clear of all liens, mortgages, (statutory or otherwise), security interests,
pledges, claims or encumbrances except those, if any, disclosed in the Financial
Statements. The Company holds its leased properties under valid and binding
leases, with such exceptions as are not materially significant in relation to
the business of the Company. The Company owns or leases all of such properties
which, to its knowledge, are necessary to its operations as now conducted.
3.7 CAPITALIZATION. All of the Company's outstanding shares of capital
stock have been duly authorized and validly issued and are fully paid and
nonassessable, have been issued in compliance with all Federal and state
securities laws, and were not issued in violation of or subject to any
preemptive right or other rights to subscribe for or purchase securities. The
actual authorized
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and outstanding capital stock of the Company as of the date hereof and as of the
Closing Date is set forth in the Memorandum under the caption "Capitalization,"
assuming 500,000 shares are issued in the Offering. Except as disclosed under
"EXECUTIVE SUMMARY - The Offering" in the Memorandum, there are no outstanding
options to purchase, or any preemptive rights or other rights to subscribe for
or to purchase, any securities or obligations convertible into, or any contracts
or commitments to issue or sell shares of the Company's capital stock or any
such options, rights, convertible securities or obligations.
3.8 LITIGATION. Except as disclosed under "BUSINESS - Legal Proceedings"
in the Memorandum, there is no pending or, to the Company's knowledge,
threatened action, suit or other proceeding before any court, governmental body
or authority, or arbitrator to which the Company is a party or to which its
property or assets are subject.
3.9 NO DEFAULTS. The Company is not in violation or default of any
provision of the Certificate of Incorporation or Bylaws, or any organizational
documents, or, to the Company's knowledge, is in breach with respect to any
provision of any agreement (including without limitation, the Stock Purchase
Agreement dated June 16, 1997 between the Company and Mentor Corporation),
judgement, decree, order, mortgage, deed of trust, lease, franchise, license,
indenture, permit or other instrument to which it is a party or by which it or
any of its properties are bound which violation, default or breach would have a
Material Adverse Effect; and the Company is not aware of any fact which
constitutes an event of default on the part of the Company as defined in such
documents or which, with notice or lapse of time or both, would constitute such
an event of default.
3.10 GOVERNMENTAL CONSENTS. No consent, approval, order or authorization
of, or registration, qualification, designation, declaration or filing with, any
Federal, state, or local governmental authority on the part of the Company is
required in connection with the consummation of the transactions contemplated by
this Agreement except for (a) compliance with the securities and blue sky laws
in the states and other jurisdictions in which Shares are offered and/or sold,
which compliance will be effected in accordance with such laws, and (b) the
filing of the Registration Statement and all amendments thereto with the SEC as
contemplated by Section 7.2 hereof. The Company has not been advised, and has
no reason to believe, that it is not conducting business in compliance in all
material respects with all applicable laws, rules and regulations of the
jurisdictions in which it is conducting business including but not limited to,
all applicable local, state and Federal environmental laws and regulations.
3.11 TAXES. The Company has accurately prepared and timely filed all
Federal, state and other tax returns which are required to be filed by it and
has timely paid all taxes covered by such returns which have become due and
payable except for such taxes as are being contested in good faith. The Company
has no knowledge of any tax deficiency which has been or might be asserted or
threatened against the Company which would have a Material Adverse Effect.
3.12 INSURANCE. The Company maintains insurance of the types and in the
amounts it deems adequate for its business covering all risks customarily
insured against, all of which insurance is in full force and effect.
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3.13 NO MATERIAL ADVERSE CHANGE. Since July 31, 1997, there have not been
any changes in the assets, liabilities, financial condition or operations 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.
3.14 DISCLOSURE. This Agreement does not contain any untrue statement of
fact or omit to state a fact necessary in order to make the statements contained
herein and therein not materially misleading.
3.15 NASDAQ NMS QUALIFICATION. The Company has submitted a listing
application and listing agreement with the Nasdaq National Market System
("NASDAQ NMS") to list the Common Stock, including the Shares, for quotation on
the Nasdaq NMS. If such listing is approved, for so long as the Company is
obligated to keep in effect the Registration Statement provided under
Section 7.2 hereof, the Company shall use its reasonable best efforts to
maintain such listing on the Nasdaq NMS, the Nasdaq SmallCap Market or a
national securities exchange, as defined in the Exchange Act.
3.16 FDA APPROVAL. To the Company's knowledge, the Company's I-125
Brachytherapy Source has received all required approvals from the Federal Drug
Administration ("FDA") for commercial distribution in the United States and the
Company has delivered to the Placement Agent copies of all correspondence with
the FDA relating to such approvals.
3.17 INVESTMENT COMPANY. The Company is not a registered investment
company within the meaning of the Investment Company Act of 1940, as amended.
3.18 RADIOMED. The Company is under no contractual obligation to purchase
any additional equity securities from, or to make any additional capital
contribution to, RadioMed.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF PURCHASERS
Each Purchaser hereby severally and not jointly, represents and warrants to
the Company, effective as of the Closing Date, as follows:
4.1 AUTHORIZATION. Purchaser represents and warrants to the Company that:
(i) Purchaser has all requisite legal and corporate or other power and capacity
and has taken all requisite corporate or other action to execute and deliver
this Agreement, to purchase the Shares to be purchased by it and to carry out
and perform all of its obligations under this Agreement; and (ii) this Agreement
constitutes the legal, valid and binding obligation of Purchaser, enforceable in
accordance with its terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, or similar laws relating to or affecting the
enforcement of creditors' rights generally and (b) as limited by equitable
principles generally.
4.2 INVESTMENT EXPERIENCE. Purchaser is an "accredited investor" as
defined in Rule 501(a) under the Securities Act of 1933, as amended (the
"SECURITIES ACT"). Purchaser is aware of the Company's business affairs and
financial condition and has had access to and has acquired sufficient
information about the Company to reach an informed and knowledgeable decision to
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acquire the Shares. Purchaser has such business and financial experience as is
required to give it the capacity to protect its own interests in connection with
the purchase of the Shares. Purchaser is able to bear the economic risk of
holding the Shares for an indefinite period, including the loss of Purchaser's
entire investment. The Shares were not offered or sold to Purchaser by any form
of general solicitation or advertising.
4.3 INVESTMENT INTENT. Purchaser is purchasing the Shares for its own
account as principal, for investment purposes only, and not with a view to, or
for, resale, distribution or fractionalization thereof, in whole or in part,
within the meaning of the Securities Act. Purchaser understands that its
acquisition of the Shares has not been registered under the Securities Act or
registered or qualified under any state securities law in reliance on specific
exemptions therefrom, which exemptions may depend upon, among other things, the
bona fide nature of Purchaser's investment intent as expressed herein.
Purchaser has completed or caused to be completed the Stock Certificate
Questionnaire and the Registration Questionnaire attached as APPENDIX I and
APPENDIX II, respectively, of EXHIBIT B hereto and the responses provided
therein shall be true and correct as of the Closing Date and will be true and
correct as of the effective date of the Registration Statement. Purchaser has,
in connection with its decision to purchase the number of shares set forth in
EXHIBIT A hereto, relied solely upon the Memorandum and the documents attached
as appendices thereto and the representations and warranties of the Company
contained herein.
4.4 REGISTRATION OR EXEMPTION REQUIREMENTS.
(a) Purchaser further acknowledges and understands that the Shares
may be required to be held indefinitely, and they may not be resold or otherwise
transferred except in a transaction registered under the Securities Act or where
an exemption from such registration is available. Purchaser understands that
the certificate(s) evidencing the Shares will be imprinted with a legend that
prohibits the transfer of the Shares unless (i) they are registered or such
registration is not required, and (ii) if the transfer is pursuant to an
exemption from registration other than Rule 144 promulgated under the Securities
Act ("RULE 144") and, if the Company shall so request in writing, an opinion of
counsel satisfactory to the Company is obtained to the effect that the
transaction is so exempt and in compliance with applicable state law.
(b) Purchaser further acknowledges that because the Common Stock is
not listed on the Nasdaq NMS or a national securities exchange, resale of the
Shares may be limited by applicable state law, even where a registration
statement covering resale of the Shares has been declared effective under the
Securities Act. For example, certain states may limit resale of the Shares to
qualified institutions or in unsolicited qualified broker transactions in the
absence of qualification or another exemption in such state.
4.5 RESTRICTION ON SHORT SALES. Purchaser represents and warrants to and
covenants with the Company that neither Purchaser nor its affiliates has engaged
or will engage in any short sales of the Common Stock prior to the effectiveness
of the Registration Statement, except to the extent that any such short sale is
fully covered by shares of Common Stock other than the Shares.
4.6 NO LEGAL, TAX OR INVESTMENT ADVICE. Purchaser understands that
nothing in the Memorandum, this Agreement or any other materials presented to
Purchaser in connection with the
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purchase and sale of the Shares constitutes legal, tax or investment advice.
Purchaser has consulted such legal, tax and investment advisors as it, in its
sole discretion, has deemed necessary or appropriate in connection with its
purchase of the Shares.
SECTION 5. CONDITIONS TO CLOSING OF PURCHASERS
Each Purchaser's obligation to purchase the Shares at the Closing is, at
the option of such Purchaser, subject to the fulfillment or waiver as of the
Closing Date of the following conditions:
5.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
made by the Company in Section 3 hereof shall be true and correct in all
material respects when made, and shall be true and correct in all material
respects on the Closing Date with the same force and effect as if they had been
made on and as of said date.
5.2 LEGAL OPINION. The Company shall have delivered a legal opinion from
X'Xxxxxx & Xxxxxx, counsel to the Company, addressed to the Purchasers and
Xxxxxxxxxxx & Co., Inc. (the "PLACEMENT AGENT") in the form attached hereto as
EXHIBIT C-1 with respect to the sale of the Shares hereunder.
5.3 OFFICER'S CERTIFICATE. The Company shall deliver to the Purchasers a
certificate, dated as of the Closing Date, signed by the President of the
Company, stating that the signer of said certificate has carefully examined the
Memorandum and the SEC Documents and that the representations and warranties
set forth in Section 3 hereof are true as of and all of the closing conditions
set forth in Section 5 hereof have been satisfied on the Closing Date.
5.4 REGISTRATION STATEMENT. The Company shall have delivered a draft of
the Registration Statement that is acceptable to the Placement Agent in a form
that may be filed with the SEC as required herein.
5.5 SAS 71 REVIEW. The Company shall have received a SAS 71 review from
its independent auditors addressed to the Company, in a form acceptable to the
Placement Agent, relating to the Company's financial statements for the three
and nine month periods ended July 31, 1997.
5.6 COVENANTS. All covenants, agreements and conditions contained in this
Agreement to be performed by the Company on or prior to the Closing Date shall
have been performed or complied with in all material respects.
5.7 ADDITIONAL DOCUMENTS. The Placement Agent shall have received such
other documents as the Placement Agent and its counsel may reasonably request
for the purpose of facilitating the consummation or performance of the sale of
the Shares and the Placement Agent and its counsel shall be satisfied with all
matters and proceedings described in this Agreement or the Memorandum.
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SECTION 6. CONDITIONS TO CLOSING OF COMPANY
The Company's obligation to sell and issue the Shares at the Closing is, at
the option of the Company, subject to the fulfillment or waiver of the following
conditions:
6.1 RECEIPT OF PAYMENT. The Company shall have received payment, by check
or wire transfer of immediately available funds, in the full amount of the
Purchase Price for the Shares sold.
6.2 REPRESENTATIONS AND WARRANTIES. The representations made by the
Purchasers in Section 4 hereof shall be true and correct in all material
respects when made, and shall be true and correct in all material respects on
the Closing Date with the same force and effect as if they had been made on and
as of such date.
6.3 COVENANTS. All covenants, agreements and conditions contained in this
Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
SECTION 7. AFFIRMATIVE COVENANTS OF THE COMPANY
The Company hereby covenants and agrees as follows:
7.1 FINANCIAL INFORMATION. The Company will mail the following reports to
each Purchaser until such Purchaser transfers, assigns or sells more than fifty
percent (50%) of the Shares purchased by such Purchaser pursuant to this
Agreement:
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-KSB.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its Quarterly Report on Form 10-QSB.
7.2 REGISTRATION REQUIREMENTS
(a) No later than fifteen (15) business days following the Closing
Date, the Company shall file with the SEC one or more registration statements on
Form S-3 (together with the prospectus included therein, a "REGISTRATION
STATEMENT") pursuant to Rule 415 of the Securities Act in order to register with
the SEC the continuous resale by the Purchasers, from time to time, of the
Shares through the Nasdaq NMS or the facilities of any national securities
exchange on which Common Stock is then traded, or in privately-negotiated
transactions. The Company shall use its best efforts to cause such Registration
Statement to be declared effective as soon thereafter as possible and in any
event within sixty (60) days thereafter. Each Purchaser agrees to furnish
promptly to the Company in writing all information required from time to time to
be disclosed in order to make the information previously furnished to the
Company by such holder not misleading.
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(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "REGISTRATION EXPENSES" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses
and the expense of any special audits incident to or required by any such
registration. "SELLING EXPENSES" shall mean selling commissions, underwriting
fees and stock transfer taxes applicable to the Shares and all fees and
disbursements of counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to:
(1) keep such registration effective until the earlier of (A)
the second anniversary of the Closing Date, (B) such date as all of the Shares
have been resold or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144;
(2) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
therewith as may be necessary to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by the
Registration Statement;
(3) furnish such number of prospectuses and other documents
incident thereto, including any amendment of or supplement to the prospectus, as
a Purchaser from time to time may reasonably request;
(4) cause all Shares registered as described herein to be listed
on each securities exchange and quoted on each quotation service on which the
Common Stock are then listed or quoted;
(5) provide a transfer agent and registrar for all Shares
registered pursuant to the Registration Statement and a CUSIP number for all
such Shares;
(6) otherwise use its best efforts promptly to comply with all
applicable rules and regulations of the SEC;
(7) file the documents required of the Company and otherwise use
its best efforts promptly to obtain, if applicable, and maintain requisite blue
sky clearance in (A) all jurisdictions in which any of the Shares are originally
sold and (B) all other states specified in writing by a Purchaser, provided as
to clause (B) however, that the Company shall not be required to qualify to do
business or consent to service of process in any state in which it is not now so
qualified or has not so consented; and
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(8) with respect to the initial filing of the Registration
Statement, as of the date of declaration of effectiveness, obtain an opinion of
counsel to the Company in the form of opinion attached hereto as EXHIBIT C-2,
addressed to each Purchaser selling registrable securities pursuant to the
Registration Statement. The Company shall use its best efforts to qualify for
use of Form S-3 under the Securities Act to register the resale of the Shares
and to maintain such qualification during the periods described in
subsection (c)(1) hereof.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to
registration, the Company covenants and agrees to: (i) make and keep public
information available, as those terms are understood and defined in Rule 144,
until the earlier of (A) the second anniversary of the Closing Date or (B) such
date as all of the Shares shall have been resold; (ii) file with the SEC in a
timely manner all reports and other documents required of the Company under the
Exchange Act; and (iii) furnish to any Purchaser upon request, as long as the
Purchaser owns any Shares, (A) a written statement by the Company that it has
complied with the reporting requirements of the Exchange Act, (B) a copy of the
most recent annual or quarterly report of the Company, and (C) such other
information as may be reasonably requested in order to avail any Purchaser of
any rule or regulation of the SEC that permits the selling of any such Shares
without registration.
(f) At any time the Company may refuse to permit a Purchaser to
resell any Shares pursuant to the Registration Statement; PROVIDED, HOWEVER,
that in order to exercise this right at any time the Company does not qualify
for Form S-3, the Company must deliver a certificate in writing to the
Purchasers to the effect that suspension of the sale of shares under the
Registration Statement, until such time as the Company can make an appropriate
filing with the SEC, is necessary because a sale pursuant to the Registration
Statement, in its then-current form, could constitute a violation of the Federal
securities laws. In such an event, the Company shall use its best efforts to
amend the Registration Statement if necessary and take all other actions
necessary to allow such sale under the Federal securities laws, and shall notify
the Purchasers and the Placement Agent promptly after it has determined that
such sale has become permissible under the Federal securities laws.
Notwithstanding the foregoing, the Company shall not under any circumstances be
entitled to exercise its right to suspend sales under the registration statement
more than two (2) times in any twelve (12) month period, and the period during
which such Registration Statement may be withdrawn shall not exceed thirty (30)
days.
7.3 INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each Purchaser
and its officers, directors, controlling persons and affiliates from and against
any losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) to which such Purchaser may become subject (under the Securities Act,
state law, common law or otherwise) insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon,
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any untrue statement of a material fact contained in, or omission of a material
fact from, the Registration Statement, or arise out of any failure by the
Company to fulfill any undertaking included in the Registration Statement or
this Agreement, and the Company will, as incurred, reimburse such Purchaser for
any legal or other expenses reasonably incurred in investigating, defending or
preparing to defend any such action, proceeding or claim; PROVIDED, HOWEVER,
that the Company shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based upon an untrue
statement made in such Registration Statement in reliance upon and in conformity
with information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement. The Company
will reimburse the Purchasers for any legal or other expenses reasonably
incurred in investigating, defending or preparing to defend any such action,
proceeding or claim notwithstanding the absence of a judicial determination as
to the propriety and enforceability of the obligations under this section and
the possibility that such payments might later be held to be improper, provided,
that to the extent any such payment is ultimately held to be improper, the
persons receiving such payments shall promptly refund them.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act, state law, common law or
otherwise) insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon an untrue
statement made in such Registration Statement in reliance upon and in conformity
with information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement; PROVIDED,
HOWEVER, that no Purchaser shall be liable in any such case for any untrue
statement included in any Prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred and in no event shall any Purchaser be liable for any
amount in excess of the net proceeds received for the sale of its Shares
pursuant to such Registration Statement.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 7.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; PROVIDED,
HOWEVER, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel to represent both the indemnified person and such indemnifying
person or any affiliate or associate thereof, the indemnified person shall be
entitled to retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 7.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) hereof in respect of any
11
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative fault of the Company on the
one hand and the Purchasers on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company on the one hand or a Purchaser on the other
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
the Purchasers agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
the Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages, or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Purchaser
shall be required to contribute any amount in excess of the amount by which the
amount received by the Purchaser from the sale of the Shares to which such loss
relates exceeds the amount of any damages which such Purchaser has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Purchasers' obligations in this subsection (d) to
contribute are several in proportion to their respective sales of Shares to
which such loss relates and not joint.
(e) The obligations of the Company and the Purchasers under this
Section 7.3 shall be in addition to any liability which the Company and the
respective Purchasers may otherwise have.
SECTION 8. RESTRICTIONS ON TRANSFERABILITY OF SHARES: COMPLIANCE WITH
SECURITIES ACT
8.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be transferable
in the absence of a registration under the Securities Act or an exemption
therefrom or in the absence of compliance with any term of this Agreement. The
Company shall be entitled to give stop transfer instructions to its transfer
agent with respect to the Shares in order to enforce the foregoing restrictions.
8.2 RESTRICTIVE LEGEND. Each certificate representing Shares shall bear
substantially the following legends (in addition to any legends required under
applicable securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT PURPOSES ONLY AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THE SHARES MAY NOT
BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
THEREFROM.
12
ADDITIONALLY, THE TRANSFER OF THE SHARES REPRESENTED BY THIS CERTIFICATE IS
SUBJECT TO CERTAIN RESTRICTIONS SPECIFIED IN THE COMMON STOCK PURCHASE
AGREEMENT DATED NOVEMBER 10, 1997 (THE "AGREEMENT") BETWEEN THE COMPANY AND
THE ORIGINAL PURCHASER, AND NO TRANSFER OF SHARES SHALL BE VALID OR
EFFECTIVE ABSENT COMPLIANCE WITH SUCH RESTRICTIONS. ALL SUBSEQUENT HOLDERS
OF THIS CERTIFICATE WILL HAVE AGREED TO BE BOUND BY CERTAIN OF THE TERMS OF
THE AGREEMENT, INCLUDING SECTIONS 7.2 AND 8.3 OF THE AGREEMENT. COPIES OF
THE AGREEMENT MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE
REGISTERED HOLDER OF THIS CERTIFICATE TO THE SECRETARY OF THE COMPANY.
8.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144, or (iii) pursuant to another exemption under the Securities Act. Purchaser
further acknowledges and agrees that such Shares are not transferable on the
books of the Company unless the certificate submitted to the Company's transfer
agent evidencing such Shares is accompanied by a separate certificate executed
by an officer of, or other person duly authorized by, the Purchaser in the form
attached hereto as EXHIBIT D.
8.4 PURCHASER INFORMATION. Each Purchaser covenants that it will promptly
notify the Company in writing of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 9. MISCELLANEOUS
9.1 WAIVERS AND AMENDMENTS. With the exception of Section 7 hereof, the
terms of this Agreement may be waived or amended with the written consent of the
Company and each Purchaser. With respect to Section 7 hereof, with the written
consent of the Company and the record holders of more than fifty percent (50%)
of the Shares then outstanding and held by Purchasers, the terms of this
Agreement may be waived or amended and any such amendment or waiver shall be
binding upon the Company and all holders of Shares.
9.2 BROKER'S FEE. Each Purchaser acknowledges that the Company intends to
pay a fee to Xxxxxxxxxxx & Co., Inc. in respect of the sale of the Shares to the
Purchaser. Each of the parties hereto hereby represents that, on the basis of
any actions and agreements by it, there are no other brokers or finders entitled
to compensation in connection with the sale of the Shares to the Purchasers.
9.3 GOVERNING LAW. This Agreement shall be governed in all respects by
and construed in accordance with the laws of the State of California without any
regard to conflicts of laws principles.
13
9.4 SURVIVAL. The representations, warranties, covenants and agreements
made in this Agreement shall survive any investigation made by the Company or
the Purchasers and the Closing.
9.5 SUCCESSORS AND ASSIGNS. The provisions hereof shall inure to the
benefit of, and be binding upon, the successors, assigns, heirs, executors and
administrators of the parties to this Agreement.
9.6 ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subjects
thereof.
9.7 NOTICES, ETC. All notices and other communications required or
permitted under this Agreement shall be effective upon receipt and shall be in
writing and may be delivered in person, by telecopy, overnight delivery service
or registered or certified United States mail, addressed to the Company or the
Purchasers, as the case may be, at their respective addresses set forth at the
beginning of this Agreement or on EXHIBIT A, or at such other address as the
Company or the Purchasers shall have furnished to the other party in writing
with a copy to Xxxxxxx Xxxxxx, Xxxxxxxxxxx & Co., Inc., 00000 Xxxxxxxx
Xxxxxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000. All notices and other communications
shall be effective upon the earlier of actual receipt thereof by the person to
whom notice is directed or (i) in the case of notices and communications sent by
personal delivery or telecopy, one business day after such notice or
communication arrives at the applicable address or was successfully sent to the
applicable telecopy number, (B) in the case of notices and communications sent
by overnight delivery service, at noon (local time) on the second business day
following the day such notice or communication was sent, and (c) in the case of
notices and communications sent by United States mail, seven (7) days after such
notice or communication shall have been deposited in the United States mail.
9.8 SEVERABILITY OF THIS AGREEMENT. If any provision of this Agreement
shall be judicially determined to be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
9.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.10 FURTHER ASSURANCES. Each party to this Agreement shall do and perform
or cause to be done and performed all such further acts and things and shall
execute and deliver all such other agreements, certificates, instruments and
documents as the other party hereto may reasonably request in order to carry out
the intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.
9.11 EXPENSES. The Company and each such Purchaser shall bear its own
expenses incurred on its behalf with respect to this Agreement and the
transactions contemplated hereby, including fees of legal counsel.
14
IN WITNESS WHEREOF, this Agreement is hereby executed as of the date first
above written.
the "COMPANY"
NORTH AMERICAN SCIENTIFIC, INC.
By: /s/ L. Xxxxxxx Xxxxxx
-----------------------------------------
L. Xxxxxxx Xxxxxx President & CEO
-----------------------------------------
[Print Name and Title]
15
the "PURCHASERS"
GT GLOBAL HEALTH CARE CLASS
Name: /s/ Xxxxxxx Xxxxxx
------------------------------------
By: Xxxxxxx Xxxxxx
------------------------------------
Title: Investment Manager
------------------------------------
16
the "PURCHASERS"
GT HEALTHCARE FUND
Name: /s/ Xxxxxxx Xxxxxx
------------------------------------
By: Xxxxxxx Xxxxxx
------------------------------------
Title: Investment Manager
------------------------------------
16
the "PURCHASERS"
CONNECTICUT CAPITAL ASSOCIATES, LP.
Name: /s/ J. Xxxxxx Xxxxx
------------------------------------
By: J. Xxxxxx Xxxxx
------------------------------------
Title: President G.P.Connecticut Capital
------------------------------------
Associates, LP.
------------------------------------
16
the "PURCHASERS"
SUNAMERICA SMALL CO. GROWTH FUND
Name: /s/ Xxxxxx Xxxxx
------------------------------------
By: Xxxxxx Xxxxx
------------------------------------
Title: Vice President Portfolio Manager
------------------------------------
16
the "PURCHASERS"
THE RAPTOR GLOBAL FUND LTD.
Name: /s/ Xxxx X. Xxxxxx
------------------------------------
By: Xxxx X. Xxxxxx
------------------------------------
Title: President
------------------------------------
16
the "PURCHASERS"
THE RAPTOR GLOBAL FUND, L.P.
Name: /s/ Xxxx X. Xxxxxx
------------------------------------
By: Xxxx X. Xxxxxx
------------------------------------
Title: President
------------------------------------
16
the "PURCHASERS"
TUDOR BVI FUTURES, LTD.
Name: /s/ Xxxx X. Xxxxxx
------------------------------------
By: Xxxx X. Xxxxxx
------------------------------------
Title: President
------------------------------------
16
the "PURCHASERS"
PROMED PARTNERS, L.P.
Name: /s/ Xxxxx X. Xxxxxx
------------------------------------
By: Xxxxx X. Xxxxxx
------------------------------------
Title: Managing Member
------------------------------------
16
the "PURCHASERS"
TUDOR ARBITRAGE PARTNERS L.P.
Name: /s/ Xxxx X. Xxxxxx
------------------------------------
By: Xxxx X. Xxxxxx
------------------------------------
Title: President
------------------------------------
16
the "PURCHASERS"
INVESCO GLOBAL HEALTH SERVICES
Name: /s/ Xxxx X. Xxxxx
------------------------------------
By: Xxxx X. Xxxxx
------------------------------------
Title: Secretary
------------------------------------
16
the "PURCHASERS"
GT GLOBAL HEALTH CARE FUND
Name: /s/ Xxxxxxx Xxxxxx
------------------------------------
By: Xxxxxxx Xxxxxx
------------------------------------
Title: Investment Manager
------------------------------------
16
EXHIBIT A
SCHEDULE OF PURCHASERS
PURCHASER NAME AND ADDRESS NUMBER OF SHARES PURCHASED
Connecticut Capital Associates L.P. 100,000
00 Xxxxxx Xx.
Xxxxxxxx, XX 00000
Tudor BVI Futures, Ltd. 114,300
c/o Tudor Investment Corporation
00 Xxxxx Xxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
The Raptor Global Fund L.P. 45,300
c/o Tudor Investment Corporation
00 Xxxxx Xxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
The Raptor Global Fund Ltd. 125,100
c/o Tudor Investment Corporation
00 Xxxxx Xxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Tudor Arbitrage Partners L.P. 15,300
c/o Tudor Investment Corporation
00 Xxxxx Xxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
ProMed Partners, L.P. 25,000
000 Xxxxxxxxx Xxxx Xx.
Xxxxxxxxx, XX 00000
INVESCO Global Health Sciences Fund 100,000
c/o INVESCO TRUST CO.
0000 Xxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
SunAmerica Small Co Growth Fund 150,000
c/o SunAmerica Inc.
000 Xxxxx Xxxxxx
Xxxxx Xxxxx
Xxx Xxxx, XX 00000
PURCHASER NAME AND ADDRESS NUMBER OF SHARES PURCHASED
GT Global Health Care Class 30,000
c/o Chancellor LGT Asset Management, Inc.
00 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
GT Global Health Care Fund 75,000
c/o Chancellor LGT Asset Management, Inc.
00 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
GT Healthcare Fund 20,000
c/o Chancellor LGT Asset Management, Inc.
00 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
TOTAL SHARES SOLD: 800,000
