EXHIBIT 4.1
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is made as of
December 26, 2003 by and between EP MedSystems, Inc., a New Jersey corporation
with its principal office at 000 Xxxxx 00 Xxxxx, Xxxxxxxx X, Xxxx Xxxxxx, Xxx
Xxxxxx 00000-0000 (the "Company"), and each of the several purchasers named in
Exhibit A attached hereto (each, a "Purchaser" and collectively, the
"Purchasers").
WHEREAS, the Company desires to issue and sell to the Purchasers an
aggregate of (i) up to 3,200,000 shares (the "Shares") of the authorized but
unissued shares of the Company's common stock, no par value, stated value $0.001
per share (the "Common Stock"); and
WHEREAS, each Purchaser, severally, wishes to purchase the number of Shares
shown next to its name on Exhibit A hereto, all upon the terms and subject to
the conditions set forth in this Agreement.
NOW THEREFORE, in consideration of the mutual agreements, representations,
warranties and covenants herein contained, the parties hereto agree as follows:
1. Definitions. As used in this Agreement, the following terms shall have the
following respective meanings:
"Affiliate" of a party means any other Person controlling, controlled
by or under common control with the specified Person. For the purposes of
this definition, "control" means the power to direct the management and
policies of such Person, whether through the ownership of voting
securities, by contract or otherwise.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and all of the rules and regulations promulgated thereunder.
"GAAP" means United States generally accepted accounting principles.
"Majority Purchasers" shall mean Purchasers which, at any given time,
hold greater than fifty percent (50%) of the outstanding Shares.
"Material Adverse Effect" shall mean a material adverse effect on the
prospects, condition (financial or other), business, operations, assets,
liabilities, or results of operations of the Company and its subsidiaries,
taken as a whole.
"NASD" means the National Association of Securities Dealers, Inc.
"Person" shall mean an individual, corporation, company, partnership,
firm, association, joint venture, trust, unincorporated organization,
government, governmental body, agency, political subdivision or other
entity.
"Registration Rights Agreement" shall mean that certain Registration
Rights Agreement, dated as of the Closing Date, among the Company and the
Purchasers.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and all of the rules and regulations promulgated thereunder.
2. Purchase and Sale of Shares.
2.1 Purchase and Sale. Subject to and upon the terms and conditions set forth
in this Agreement, the Company agrees to issue, sell and deliver to each
Purchaser, and each Purchaser, severally, hereby agrees to purchase from
the Company, at the Closing, (i) the number of shares of Common Stock set
forth opposite the name of such Purchaser under the heading "Number of
Shares to be Purchased" on Exhibit A hereto, at a purchase price of $2.56
per share. The total purchase price payable by each Purchaser for the
number of shares of Common Stock that such Purchaser is hereby agreeing to
purchase is set forth opposite the name of such Purchaser under the heading
"Purchase Price" on Exhibit A hereto. The Company shall be obligated to
register the Shares pursuant to the terms and conditions set forth in the
Registration Rights Agreement.
2.2 Closing. The closing of the transactions contemplated under this Agreement
(the "Closing") shall take place at 10:00 a.m. at the offices of Xxxxxx
Xxxxxx White & XxXxxxxxx LLP in New York, New York on December 26, 2003, or
at such other location, date and time as may be agreed upon between the
Majority Purchasers and the Company (the "Closing Date"). At the Closing,
the Company shall authorize its transfer agent to issue to each Purchaser,
against delivery of payment for the Shares by wire transfer of immediate
available funds in accordance with the Company's instructions, one or more
stock certificates registered in the name of each Purchaser, representing
the number of shares set forth opposite the appropriate Purchaser's name on
Exhibit A hereto, and bearing the legend set forth in Section 6.2 hereof.
Closing documents may be delivered by facsimile with original signature
pages sent by overnight courier.
2.3 Independent Purchasers. The Company acknowledges and agrees that each of
the Purchasers is acting solely in the capacity of an arm's length
purchaser with respect to this Agreement and the transactions contemplated
hereby and that each Purchaser has separately negotiated the terms of this
Agreement. Nothing contained herein or in any agreement or document
relating to this transaction, and no action taken by any Purchaser, shall
be deemed to constitute the Purchasers as, or to create any presumption
that the Purchasers are in any way acting in concert or as, a group with
respect to the obligations or transaction hereunder. No Purchaser has
relied upon any other Purchaser for advice in entering into the
transactions contemplated hereby.
3. Representations and Warranties of the Company. The Company hereby
represents and warrants to each of the Purchasers as follows:
3.1 Organization and Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the
State of New Jersey and has all requisite power and authority, and all
necessary licenses and permits, to own and lease its properties and assets
and to Conduct its business as now conducted. Each subsidiary as referred
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to in the SEC Documents (as hereinafter defined) is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all requisite power and
authority, and all necessary licenses and permits, to own and lease its
properties and assets and to conduct its business as now conducted. The
Company and its subsidiaries are each qualified to do business as a foreign
corporation and are in good standing in all states where the conduct of
their respective businesses or their ownership or leasing of property
requires such qualification, except where the failure to so qualify would
not have a Material Adverse Effect. The Company does not own or control,
directly or indirectly, any interest in any other corporation, partnership,
limited liability company, unincorporated business organization,
association, trust or other business entity.
3.2 Capitalization.
(a) The authorized capital stock of the Company consists of: (i) 5,000,000
shares of preferred stock of the Company, no par value per share, of which
373,779 shares are issued and outstanding; and (ii) 30,000,000 shares of
Common Stock, no par value, $.001 stated value per share, of which,
immediately prior to the consummation of the transactions contemplated
hereby, 19,862,179 shares are issued and outstanding and all such
outstanding shares are validly issued, fully paid and nonassessable; (iii)
1,000,000 shares of Common Stock reserved for issuance pursuant to the
Company's 1995 Long Term Incentive Plan; (iv) 540,000 shares of Common
Stock reserved for issuance pursuant to the Company's 1995 Director Option
Plan; and (v) 600,000 shares of Common Stock reserved for issuance pursuant
to the Company's 2002 Directors Plan. With respect to the 1995 Long Term
Incentive Plan, the 1995 Stock Option Plan, the 2002 Stock Option Plan and
other non-plan stock options and warrants, an aggregate of 3,274,577
options and warrants have been granted or issued and are outstanding as of
the Closing Date.
(b) There are no preemptive or similar rights to purchase or otherwise acquire
shares of capital stock of the Company pursuant to any provision of law or
the Amended and Restated Certificate of Incorporation or By-Laws of the
Company or by agreement or otherwise. Except as set forth in this Section
3.2 and except as set forth in the SEC Documents, there are no outstanding
subscriptions, warrants, options or other rights or commitments of any
character to subscribe for or purchase from the Company, or obligating the
Company to issue, any shares of capital stock of the Company or any
securities convertible into or exchangeable for such shares.
(c) There are no stockholder agreements, voting agreements, or similar
agreements with respect to the Common Stock to which the Company is a
party, or to the knowledge of the Company, by or between any stockholders
of the Company or any of its Affiliates.
3.3 Authorization. The Company has all requisite corporate power to enter into
this Agreement and the Registration Rights Agreement, to issue the Shares
and to carry out and perform its obligations under the terms of this
Agreement and the Registration Rights Agreement (including, without
limitation, the issuance of the Shares). All corporate action on the part
of the Company, its officers, directors and stockholders necessary for the
authorization, execution, delivery and performance of this Agreement and
the Registration Rights Agreement and the consummation of the transactions
contemplated herein and therein has been taken or will be taken prior to
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the Closing Date. When executed and delivered by the Company, each of this
Agreement and the Registration Rights Agreement shall constitute the legal,
valid and binding obligation of the Company, enforceable against the
Company in accordance with their respective terms, except as such may be
limited by bankruptcy, insolvency, reorganization or other laws affecting
creditors' rights generally and by general equitable principles.
3.4 Valid Issuance of the Shares. The Shares being purchased by the Purchasers
hereunder will, upon issuance pursuant to the terms hereof, be validly
issued, fully paid and nonassessable, free from all liens, claims,
encumbrances with respect to the issuance of such Shares and will not be
subject to any preemptive or similar rights. Except for blue sky filing
fees, if any, there are no state or city taxes, fees or other charges
payable in connection with the execution or delivery of this Agreement, the
Registration Rights Agreement and the Shares.
3.5 Financial Statements. The Company has furnished to each Purchaser its
audited Statements of Income, Stockholders' Equity and Cash Flows for the
fiscal year ended December 31, 2002, its audited Balance Sheet as of
December 31, 2002, its unaudited Statements of Income, Stockholders' Equity
and Cash Flows for the period from December 31, 2002 through September 30,
2003 and its unaudited Balance Sheet as of September 30, 2003. All such
financial statements are hereinafter referred to collectively as the
"Financial Statements." The Financial Statements have been prepared in
accordance with U.S. generally accepted accounting principles applied on a
consistent basis during the periods involved, and fairly present, in all
material respects, the financial position of the Company and the results of
its operations as of the date and for the periods indicated thereon, except
that the unaudited financial statements may not be in accordance with U.S.
generally accepted accounting principles because of the absence of
footnotes and are subject to normal year-end audit adjustments which,
individually, and in the aggregate, will not be have a Material Adverse
Effect. Since September 30, 2003, to the Company's knowledge, (i) there has
been no development or change (actual or threatened), individually or in
the aggregate, having a Material Adverse Effect, (ii) except as set forth
in an SEC Document (as defined below), there does not exist any condition
reasonably likely to result in a Material Adverse Effect and (iii) the
Company has conducted its business only in the ordinary course consistent
with past practice. The Company has no indebtedness, obligations or
liabilities of any kind (whether accrued, absolute, contingent or
otherwise, and whether due or to become due) which were not fully reflected
in, reserved against or otherwise described in the Financial Statements or
the notes thereto, or incurred in the ordinary course of business
consistent with the Company's past practices, all of which individually and
in the aggregate do not or would not have a Material Adverse Effect.
3.6 SEC Documents. The Company has made available to each Purchaser, a true and
complete copy of the Company's Annual Report on Form 10-KSB for the year
ended December 31, 2002, the Company's Quarterly Report on Form 10-QSB/A
for the three months ended March 31, 2003, and the Company's Quarterly
Reports on Form 10-QSB for the three months ended June 30, 2003 and
September 30, 2003 and any other statement, report, registration statement
(other than registration statements on Form S-8) or definitive proxy
statement filed by the Company with the SEC during the period commencing on
December 31, 2002 and ending on the date hereof. The Company will, promptly
upon the filing thereof, also make available to each Purchaser all
statements, reports (including, without limitation, Quarterly Reports on
Form 10-QSB and Current Reports on Form 8-K), registration statements and
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definitive proxy statements filed by the Company with the SEC during the
period commencing on the date hereof and ending on the Closing Date (all
such materials required to be furnished to each Purchaser pursuant to this
sentence or pursuant to the next preceding sentence of this Section 3.6
being called, collectively, including any amendments thereto, the "SEC
Documents"). Since January 1, 2003, the Company has timely made all filings
required to be made by it under the Exchange Act and the securities laws of
any state, and any rules and regulations promulgated thereunder. The SEC
Documents comply in all material respects with the requirements of the
Exchange Act or the Securities Act, as applicable, and none of the SEC
Documents contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order
to make the statements made therein, in light of the circumstances under
which they were made, not misleading, as of their respective filing dates,
except to the extent corrected by a subsequently filed SEC Document filed
prior to the date hereof. The Company is eligible to use a registration
statement on Form S-3 with respect to the registration of Registrable
Securities (as such term is defined in the Registration Rights Agreement)
pursuant to the Registration Rights Agreement.
3.7 Consents. Except for filings under federal and applicable state
securities laws and except for Permits (as defined below), the absence of
which either individually or in the aggregate would not have a Material
Adverse Effect, all permits, consents, approvals, orders, authorizations
of, or declarations to (collectively, "Permits") or filings with any
federal, state, local or foreign court, governmental or regulatory
authority, or other person (including third party consents) required on the
part of the Company in connection with the execution, delivery or
performance of this Agreement and the Registration Rights Agreement and the
consummation of the transactions contemplated herein and therein have been
obtained or will be obtained prior to the Closing Date, and will be
effective as of the Closing Date.
3.8 No Conflict. The execution and delivery of this Agreement and the
Registration Rights Agreement by the Company and the consummation of the
transactions contemplated hereby and thereby (including, without
limitation, the issuance of the Shares) will not (x) conflict with or
result in any violation of or default (with or without notice or lapse of
time, or both) under, or give rise to a right of termination, cancellation
or acceleration of any obligation or to a loss of a material benefit under
(i) any provision of the Amended and Restated Certificate of Incorporation
or bylaws of the Company or (ii) any agreement or instrument, Permit,
franchise, license, judgment, order, statute, law, ordinance, rule or
regulations, applicable to the Company, any of its subsidiaries or their
respective properties or assets or (y) result in the creation of any lien,
security interest, charge or encumbrance upon the Company's or any of its
subsidiaries' assets, properties or outstanding capital stock.
3.9 Brokers or Finders. Except for X.X. Xxxxxxxxx, Towbin, a California limited
partnership (the "Placement Agent"), the Company has not dealt with any
broker or finder in connection with the transactions contemplated by this
Agreement, and, except for certain fees and expenses payable by the Company
to the Placement Agent and Xxxxx, Xxxxxxxx & Xxxx, Inc., the Company has
not incurred, and shall not incur, directly or indirectly, any liability
for any brokerage or finders' fees or agents commissions or any similar
charges in connection with this Agreement or any transaction contemplated
hereby.
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3.10 Nasdaq SmallCap Market. The Common Stock is listed on The Nasdaq SmallCap
Market, and there are no proceedings to revoke or suspend such listing. The
issuance of the Shares will not contravene any NASDAQ Marketplace Rule. The
Common Stock is registered pursuant to Section 12(g) of the Exchange Act.
The Company has taken no action designed to, or which to its knowledge is
likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act, delisting the Common Stock from The Nasdaq
SmallCap Market. The Company has not received any notification that, and
has no knowledge that, the SEC or the NASD is contemplating terminating
such listing or registration. The issuance of the Shares does not require
stockholder approval, including, without limitation, as may be required
pursuant to the Nasdaq Marketplace Rules.
3.11 Absence of Litigation. Except as set forth in the SEC Documents, there is
no action, suit or proceeding or, to the Company's knowledge, any
investigation, pending, or to the Company's knowledge, threatened by or
before any governmental body against the Company, its subsidiaries, its
activities, properties or assets or any officer, director, or employee of
the Company in connection with such officer's, director's or employee's
relationship with, or actions taken on behalf of the Company and in which
an unfavorable outcome, ruling or finding in any said matter, or for all
matters taken as a whole, might have a Material Adverse Effect. The
foregoing includes, without limitation, any such action, suit, proceeding
or investigation that questions this Agreement or the Registration Rights
Agreement or the right of the Company to execute, deliver and perform under
same. The Company is not a party to, or subject to the provisions of any
order, writ or injunction, judgment or decree of any court or government
agency or instrumentality.
3.12 Fiduciary Duties. The Company represents and warrants that, to the best of
its knowledge, none of its directors or officers is or has been the subject
of, or a defendant in: (i) an enforcement action or prosecution (or
settlement in lieu thereof) brought by a governmental authority relating to
a violation of securities, fiduciary or criminal laws, or (ii) a civil
action (or settlement in lieu thereof) brought by stockholders or investors
for violation of duties owed to the stockholders or investors.
3.13 Title to Property and Assets. Except as disclosed in the SEC Documents,
each of the Company and its subsidiaries owns its property and assets free
and clear of all mortgages, liens, loans, claims, charges and encumbrances,
and except such encumbrances and liens that arise in the ordinary course of
business and do not materially impair their respective ownership or use of
such property or assets. With respect to property and assets it leases, the
Company is in material compliance with such leases and, to the best of its
knowledge, holds a valid leasehold interest free of any liens, charges,
claims or encumbrances, except to the extent any such lien, charge, claim
or encumbrance would not have a Material Adverse Effect.
3.14 Patents. Trademarks. Proprietary Rights.
(a) To the Company's knowledge, each of the Company and its subsidiaries owns
or has the right to use all of the Intellectual Property Rights (as defined
below), except where such failure would not have a Material Adverse Effect
on the business, properties or assets of the Company and its subsidiaries,
taken as a whole. For purposes of this Agreement, "Intellectual Property
Rights" means all patents, copyrights, trademarks, service marks, trade
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names, permits, trade secrets, computer programs, software designs and
related materials and other intellectual property that are used by the
Company or a subsidiary and are material to the conduct of the Company's or
a subsidiary's business.
(b) To the Company's knowledge, the Company's and each subsidiary's use and
enjoyment of the Intellectual Property Rights do not violate any license or
conflict with or infringe the intellectual property rights of others in a
manner which would materially and adversely affect the business, assets,
properties, operations or condition (financial or otherwise) of the Company
and its subsidiaries, taken as a whole.
3.15 Environmental Matters. Except as set forth in the SEC Documents, to the
Company's knowledge, neither the Company nor any of its subsidiaries is in
violation of any applicable statute, law or regulation relating to the
environment or occupational health and safety, which violation could
reasonably be expected to result in a Material Adverse Effect, and to the
best of its knowledge, no expenditures are required in order to comply with
any such existing statute, law or regulation, which expenditures could
reasonably be expected to result in a Material Adverse Effect.
3.16 Permits. Each of the Company and its subsidiaries possesses all Permits or
similar authority necessary to conduct its business as described in the SEC
Documents, except where the failure to possess such Permits would not,
individually or in the aggregate, have a Material Adverse Effect on the
Company or its subsidiaries ("Material Permits"), and neither the Company
nor any such subsidiary has received any notice of proceedings relating to
the revocation or modification of any Material Permit.
3.17 Employees. To the Company's knowledge, no strike, labor dispute or union
organizing activities are pending or threatened against the Company or any
of its subsidiaries by its employees. No employees belong to a union or
collective bargaining unit. To the Company's knowledge, neither the Company
nor any of its subsidiaries has any workers' compensation liabilities.
3.18 Tax Matters. The Company has filed all tax returns and reports as required
by federal, state, local, and foreign law and has paid all taxes shown
thereon that have become due and payable. Such returns and reports were
materially accurate and complete when filed and reflect all taxes and other
assessments due thereunder to be paid by the Company, except those
contested by it in good faith. The provision for taxes of the Company
included in the provision for accrued liabilities in the Company's
Financial Statements is adequate for taxes due or accrued as of the dates
thereof. The Company has never had any material tax deficiency proposed or
assessed against it.
3.19 Compliance with Certificate of Incorporation and By-laws; Compliance with
Laws. The Company is not in violation or default of any provisions of its
Amended and Restated Certificate of Incorporation or Bylaws. The business
and operations of the Company and each of its subsidiaries have been
conducted in accordance with all applicable laws, rules and regulations of
all governmental agencies, authorities and instrumentalities (including,
without limitation, under the Employee Retirement Income Security Act of
1974, as amended, laws and regulations administered by the Food and Drug
Administration, and all laws relating to the employment of labor), except
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for such violations which would not, individually or in the aggregate, have
a Material Adverse Effect.
3.20 Insurance. The Company and each of its subsidiaries maintains insurance of
the type and in the amount reasonably adequate for its business, including,
but not limited to, insurance covering all real and personal property owned
or leased by the Company against theft, damage, destruction, acts of
vandalism, and all other risks customarily insured against by similarly
situated companies, all of which insurance is in full force and effect.
3.21 Investment Company Act. The Company is not an "investment company" within
the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and the Company is not directly or indirectly
controlled by or acting on behalf of any person that is an "investment
company" within the meaning of the Investment Company Act.
3.22 Compliance With Securities Laws. Assuming the accuracy of the
representations and warranties of the Purchasers set forth in Section 4
hereof, the offer and sale by the Company of the Shares are exempt from the
registration and prospectus delivery requirements of the Securities Act.
Other than pursuant to an effective registration statement under the
Securities Act, the Company has not issued, offered or sold any shares of
Common Stock (including for this purpose any securities of the same or a
similar class as the Common Stock) within the six (6) month period
preceding the date hereof or taken any other action, or failed to take any
action, that, in any such case, would (i) eliminate the availability of the
exemption from registration under Regulation D under the Securities Act in
connection with the offer and sale of the Shares as contemplated hereby or
(ii) cause the offering of the Shares pursuant to this Agreement to be
integrated with prior offerings by the Company for purposes of the
Securities Act or any applicable stockholder approval provisions,
including, without limitation, under the rules and regulations of the NASD,
as applicable. The Company shall not directly or indirectly take, and shall
not permit any of its directors, officers or Affiliates directly or
indirectly to take, any action (including, without limitation, any offering
or sale to any Person of the Shares or any Common Stock) that will make
unavailable the exemption from registration under the Securities Act being
relied upon by the Company for the offer and sale to the Purchasers of the
Shares as contemplated by this Agreement, including, without limitation,
the filing of a registration statement under the Securities Act. No form of
general solicitation or advertising within the meaning of Rule 502(c) under
the Securities Act has been used or authorized by the Company or any of its
officers, directors or Affiliates in connection with the offer or sale of
the Shares as contemplated by this Agreement or any other agreement to
which the Company is a party.
3.23 Registration Rights. Except as set forth in the SEC Documents, there are no
Persons (except the Purchasers and their permitted transferors hereunder)
with registration or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise registered by the
Company under the Securities Act which have not been satisfied.
3.24 Related Party Transactions. Except as set forth in the SEC Documents,
neither the Company nor any of its officers, directors or Affiliates nor
any family member of any officer, director or Affiliate of the Company has
borrowed any moneys from or has outstanding any indebtedness or other
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similar obligations to the Company. Except as set forth in the SEC
Documents, no director or Affiliate nor any family member of any officer,
director or Affiliate of the Company (i) owns any direct or indirect
interest constituting more than a 1% equity (or similar profit
participation) interest in, or controls or is a director, officer, partner,
member or employee of, or consultant or lender to or borrower from, or has
the right to participate in the profits of, any person or entity which is a
participant in any transaction to which the Company or any subsidiary is a
party or (ii) is a party to any contract, agreement, commitment or other
arrangement with the Company or any subsidiary or (iii) has entered into
any transaction with the Company or any subsidiary that would be required
to be disclosed under Item 404 of Regulation S-K.
3.25 Contracts. All contracts and agreements filed or required to be filed as
exhibits to the SEC Documents filed prior to the date hereof, except such
contracts and agreements that have expired by their own terms
(collectively, "Contracts") are in full force and effect and constitute
legal, valid and binding obligations of the Company and, to the best
knowledge of the Company, the other parties thereto; the Company and, to
the best knowledge of the Company, each other party thereto, have performed
in all material respects all obligations required to be performed by them
under the Contracts, and no material violation or default exists in respect
thereof, nor any event that with notice or lapse of time, or both, would
constitute a default thereof, on the part of the Company or, to the best
knowledge of the Company, any other party thereto; none of the Contracts is
currently being renegotiated; and the validity, effectiveness and
continuation of all Contracts will not be materially adversely affected by
the transactions contemplated by this Agreement.
3.26 Disclosure. Neither this Agreement nor the SEC Documents taken together
contain any untrue statement of a material fact nor omit to state a
material fact necessary in order to make the statements contained herein or
therein, in light of the circumstances under which they were made, not
misleading. To the Company's knowledge, neither it nor, any Person on its
behalf, has provided any of the Purchasers or their agents or counsel with
any information that constitutes, or might reasonably be expected to
constitute, material, non-public information. The Company understands and
confirms that each of such Purchasers will rely on the foregoing
representations in effecting transactions in securities of the Company.
3.27 Xxxxxxxx-Xxxxx. The Chief Executive Officer and the Chief Financial Officer
of the Company have signed, and the Company has furnished to the SEC, all
certifications required by Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act
of 2002. Such certifications contain no qualifications or exceptions to the
matters certified therein and have not been modified or withdrawn; and
neither the Company nor any of its officers has received notice from any
governmental entity questioning or challenging the accuracy, completeness,
form or manner of filing or submission of such certifications.
3.28 Disclosure Controls and Procedures. The Company and its subsidiaries
maintain a system of disclosure controls and procedures (as defined in
Rules 13a-15 and 15d-15 of the Exchange Act) . To the Company's best
knowledge, the Company's disclosure controls and procedures are effective
to ensure that information required to be disclosed by the Company in
reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
SEC rules and forms.
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4. Representations, Warranties and Agreements of the Purchasers. Each
Purchaser severally for itself, and not jointly with the other Purchasers,
represents and warrants to, and agrees with, the Company as follows:
4.1 Authorization. Such Purchaser has all requisite power under its constituent
documents to enter into each of this Agreement and the Registration Rights
Agreement and to carry out and perform its obligations under the terms of
this Agreement and the Registration Rights Agreement. All action on the
part of such Purchaser and, if applicable, its officers, directors,
stockholders, managers, members and equityholders necessary for the
authorization, execution, delivery and performance of this Agreement and
the Registration Rights Agreement and the consummation of the transactions
contemplated herein and therein has been taken. When executed and
delivered, each of this Agreement and the Registration Rights Agreement
will constitute the legal, valid and binding obligation of such Purchaser,
enforceable against such Purchaser in accordance with its terms, except as
such may be limited by bankruptcy, insolvency, reorganization or other laws
affecting creditors' rights generally and by general equitable principles.
4.2 Purchase Entirely for Own Account. Such Purchaser is acquiring the Shares
being purchased by it hereunder for investment, for its own account, and
not for resale or with a view to distribution thereof in violation of the
Securities Act.
4.3 Investor Status; Etc. Such Purchaser certifies and represents to the
Company that at the time such Purchaser acquires any of the Shares, such
Purchaser will be an "Accredited Investor" as defined in Rule 501 of
Regulation D promulgated under the Securities Act and was not organized for
the purpose of acquiring the Shares. Such Purchaser's financial condition
is such that it is able to bear the risk of holding the Shares for an
indefinite period of time and the risk of loss of its entire investment.
Such Purchaser has sufficient knowledge and experience in investing in
companies similar to the Company in terms of the Company's stage of
development so as to be able to evaluate the risks and merits of its
investment in the Company. Such Purchaser has received and carefully
reviewed descriptive materials relating to the Company and any other
materials relating thereto that such Purchaser has requested. Such
Purchaser has had an opportunity to ask questions of and receive answers
from the authorized representatives of the Company, and to review any
relevant documents and records concerning the business of the Company and
the terms and conditions of this investment, and that any such questions
have been answered to such Purchaser's full satisfaction. No Person other
than the Company or its authorized representatives, has offered the
securities to the Purchaser. Such Purchaser is acquiring the Shares for
such Purchaser's 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, in any manner in violation of applicable
United States federal or state securities laws or the rules or regulations
promulgated thereunder. Such Purchaser has made no agreement with others
regarding any sale, transfer, assignment or other disposition of any
interest in the Shares. Such Purchaser is aware that, in the view of the
SEC and certain state securities commissions, a purchase of the Shares now
with an intent to resell by reason of any foreseeable specific contingency
or anticipated change in market values or any change in the condition of
the Company, or in connection with a contemplated liquidation or settlement
of any loan obtained
10
for the acquisition of the Shares and for which the Shares were pledged as
security, would represent an intent inconsistent with this representation.
Such Purchaser further represents and agrees that if, contrary to the
foregoing intentions, such Purchaser should later desire to dispose of or
transfer any of the Shares in any manner, such Purchaser shall not do so
without first complying with the provisions of Section 6.1. Such Purchaser
understands that no federal or state agency has passed upon or made any
recommendation or endorsement of an investment in the Shares. The foregoing
shall in no way limit or modify the representations of the Company set
forth in Section 3 hereof.
4.4 Shares Not Registered. Such Purchaser understands that the Shares have not
been registered under the Securities Act, by reason of their issuance by
the Company in a transaction exempt from the registration requirements of
the Securities Act, and that the Shares must continue to be held by such
Purchaser unless a subsequent disposition thereof is registered under the
Securities Act or is exempt from such registration. The Purchaser
understands that the exemptions from registration afforded by Rule 144 (the
provisions of which are known to it) promulgated under the Securities Act
depend on the satisfaction of various conditions, and that, if applicable,
Rule 144 may afford the basis for sales only in limited amounts.
4.5 No Conflict. The execution and delivery of this Agreement and the
Registration Rights Agreement by such Purchaser and the consummation by it
of the transactions contemplated hereby and thereby will not conflict with
or result in any violation of or default by such Purchaser (with or without
notice or lapse of time, or both) under (i) any provision of the
organizational documents of such Purchaser or (ii) any judgment, Order,
statute, law, ordinance, rule or regulations, applicable to such Purchaser
or its respective properties or assets.
4.6 Brokers. Such Purchaser has not retained, utilized or been represented by
any broker or finder in connection with the transactions contemplated by
this Agreement.
4.7 Consents. All consents, approvals, orders and authorizations required on
the part of such Purchaser in connection with the execution, delivery or
performance of this Agreement and the Registration Rights Agreement and the
consummation of the transactions contemplated herein have been obtained and
are effective as of the Closing Date.
4.8 Agreement with Respect to Short Sales. Neither the Purchasers nor any of
their respective Affiliates nor any person acting on their behalf will have
entered into for a period of 5 days prior to the Closing Date, any "short
sale" (as such term is defined in Rule 3b-3 under the Securities Exchange
Act of 1934, as amended).
5. Conditions Precedent.
5.1 Conditions to the Obligation of the Purchasers to Consummate the Closing.
The obligation of each Purchaser to consummate the Closing and to purchase
and pay for the Shares being purchased by it pursuant to this Agreement is
subject to the satisfaction of the following conditions precedent (or
waiver by such Purchaser):
(a) The representations and warranties contained herein of the Company shall be
true and correct on and as of the Closing Date with the same force and
effect as though made on and as of the Closing Date (it being understood
and agreed by each Purchaser that, in the case of any representation and
11
warranty of the Company contained herein which is not hereinabove qualified
by application thereto of a materiality standard, such representation and
warranty need be true and correct only in all material respects in order to
satisfy as to such representation or warranty the condition precedent set
forth in the foregoing provisions of this Section 5.1(a)).
(b) Prior to the Closing Date, no event shall have occurred which has had a
Material Adverse Effect shall have occurred and the Company shall have
performed all covenants, agreements, obligations and conditions herein
required to be performed or observed by the Company on or prior to the
Closing Date.
(c) No suit, action, or other proceeding challenging this Agreement or the
transactions contemplated hereby, or seeking to prohibit, alter, prevent or
materially delay the Closing, shall have been instituted before any court,
arbitrator or governmental body, agency or official and shall be pending.
(d) The purchase of and payment for the Shares by such Purchasers shall not be
prohibited by any law or governmental order or regulation. All necessary
consents, approvals, licenses, Permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or
administrative agency or of any other person with respect to any of the
transactions contemplated hereby (including, without limitation, the
issuance of the Shares) shall have been duly obtained or made and shall be
in full force and effect.
(e) The Company shall have complied with all applicable requirements of federal
and state securities or "blue sky" laws with respect to the issuance of the
Shares, and each Purchaser, at such Purchaser's request, shall have been
provided reasonable evidence thereof.
(f) The Common Stock of the Company (i) shall be designated for quotation or
listed on The Nasdaq SmallCap Market and (ii) shall not have been suspended
from trading on The Nasdaq SmallCap Market.
(g) The Registration Rights Agreement shall have been executed and delivered by
the Company.
(h) A certificate shall have been delivered by the Company, signed by its
President or Chief Executive Officer, to the effect that: (i) the
representations and warranties of the Company contained in this Agreement
are true and correct in all material respects on and as of the Closing
Date, as though newly made on and as of that date (except for
representations and warranties which speak as of the date of the Agreement
or as of another specific date or period covered thereby) and (ii) the
Company has performed or complied with, in all material respects, all of
its covenants contained in this Agreement and required to be performed or
complied with on or before Closing Date.
(i) The Company shall have delivered to each Purchaser an opinion of counsel
for the Company, dated the Closing Date, in substantially the form of
Exhibit B attached hereto.
(j) A stock certificate shall have been delivered by the Company, registered in
the name of such Purchaser or nominee as designated by such Purchaser in
writing,
12
representing the number of shares of Common Stock purchased by such
Purchaser, free of all restrictive and other legends (except as provided in
Section 6.2 hereof), against payment of the purchase price therefor by wire
transfer of immediately available funds to such account or accounts as the
Company shall designate in writing.
(k) All instruments and corporate proceedings in connection with the
transactions contemplated by this Agreement to be consummated at the
Closing shall be satisfactory in form and substance to such Purchaser, and
such Purchaser shall have received copies (executed or certified, as may be
appropriate) of all documents which such Purchaser may have reasonably
requested in connection with such transactions.
(l) No proceeding challenging this Agreement or the transactions contemplated
hereby, or seeking to prohibit, alter, prevent or materially delay the
Closing, shall have been instituted before any court, arbitrator or
governmental body, agency or official and shall be pending.
(m) The Company shall have delivered to the Purchasers a certificate of the
Company executed by the Company's Secretary attaching and certifying to the
truth and correctness of (i) the Company's Amended and Restated Certificate
of Incorporation, (ii) the Company's Bylaws and (iii) the resolutions
adopted by the Company's Board of Directors in connection with the
transactions contemplated by this Agreement.
(n) Purchasers shall have committed, pursuant to the terms hereof, to purchase
an aggregate of at least 2,500,000 Shares.
5.2 Conditions to the Obligation of the Company to Consummate the Closing. The
obligation of the Company to consummate the Closing, to issue and sell to
each Purchaser the Shares to be purchased by it at the Closing is subject
to the satisfaction of the following conditions precedent (or waiver by the
Company):
(a) The representations and warranties contained herein of such Purchaser shall
be true and correct on and as of the Closing Date with the same force and
effect as though made on and as of the Closing Date (it being understood
and agreed by the Company that, in the case of any representation and
warranty of each Purchaser contained herein which is not hereinabove
qualified by application thereto of a materiality standard, such
representation and warranty need be true and correct only in all material
respects in order to satisfy as to such representation or warranty the
condition precedent set forth in the foregoing provisions of this Section
5.2(a)).
(b) The Registration Rights Agreement shall have been executed and delivered by
each Purchaser.
(c) Such Purchaser shall have performed all obligations and conditions herein
required to be performed or observed by it on or prior to the Closing Date.
(d) No proceeding challenging this Agreement or the transactions contemplated
hereby, or seeking to prohibit, alter, prevent or materially delay the
13
Closing, shall have been instituted before any court, arbitrator or
governmental body, agency or official and shall be pending.
(e) The sale of the Shares by the Company shall not be prohibited by any law or
governmental order or regulation. All necessary consents, approvals,
licenses, Permits, orders and authorizations of, or registrations,
declarations and filings with, any governmental or administrative agency or
of any other person with respect to any of the transactions contemplated
hereby shall have been duly obtained or made and shall be in full force and
effect.
(f) Such Purchaser shall have executed and delivered to the Company an executed
Investor Questionnaire, in substantially the form attached hereto as
Exhibit C, pursuant to which each such Purchaser shall provide information
necessary to confirm each such Purchaser's status as an "accredited
investor" (as such term is defined in Rule 501 promulgated under the
Securities Act).
(g) The Company shall have received executed agreements (which may be a
counterpart signature to this Agreement) from each of the Purchasers to
purchase, in accordance with this Agreement, the number of shares of Common
Stock set forth on Exhibit A opposite its name under the heading "Number of
Shares to be Purchased."
(h) All instruments and corporate proceedings in connection with the
transactions contemplated by this Agreement to be consummated at the
Closing shall be satisfactory in form and substance to the Company, and the
Company shall have received counterpart originals, or certified or other
copies of all documents, including, without limitation, records of
corporate or other proceedings, which it may have reasonably requested in
connection therewith.
(i) Purchasers shall have committed, pursuant to the terms hereof, to purchase
an aggregate of at least 2,500,000 Shares.
6. Transfer; Legends.
6.1 Securities Law Transfer Restrictions. No Purchaser shall sell, assign,
pledge, transfer or otherwise dispose or encumber any of the Shares being
purchased by it hereunder, except: (i) pursuant to an effective
registration statement under the Securities Act or (ii) pursuant to an
available exemption from registration under the Securities Act and
applicable state securities laws and, if reasonably requested by the
Company, upon delivery by such Purchaser of an opinion of counsel
reasonably satisfactory to the Company to the effect that the proposed
transfer is exempt from registration under the Securities Act and
applicable state securities laws. Any transfer or purported transfer of the
Shares in violation of this Section 6.1 shall be voidable by the Company;
provided, however, that no opinion will be required in connection with (1)
a public sale or transfer of Shares pursuant to an effective registration
statement in connection with which such Purchaser represents in writing to
the Company that such Shares have been or are being sold pursuant to such
registration statement; (2) a public sale of Shares pursuant to Rule 144
under the Securities Act if such Purchaser has delivered to the Company a
14
customary and accurate Rule 144 broker's and seller's representation
letter; or (3) a sale of shares pursuant to Rule 144(k) under the
Securities Act if such Purchaser has delivered to the Company a customary
and accurate Rule 144 seller's representation letter. The Company shall not
register any transfer of the Shares in violation of this Section 6.1. The
Company may, and may instruct any transfer agent for the Company, to place
such stop transfer orders as may be required on the transfer books of the
Company in order to ensure compliance with the provisions of this Section
6.1.
6.2 Legends. Each certificate representing any of the Shares shall be endorsed
with a legend in substantially the form set forth below, and each Purchaser
covenants that, except to the extent such restrictions are waived by the
Company, it shall not transfer the shares represented by any such
certificate without complying with the restrictions on transfer described
in this Agreement and the legends endorsed on such certificate:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY STATE AND MAY ONLY BE OFFERED, SOLD, ASSIGNED,
PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF PURSUANT TO (I) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND SUCH LAWS OR (II)
AN EXEMPTION FROM REGISTRATION UNDER SAID ACT, AND TO THE EXTENT
PERMITTED BY SECTION 6.1 OF THE COMMON STOCK PURCHASE AGREEMENT
PURSUANT TO WHICH THE SHARES REPRESENTED HEREBY WERE ACQUIRED, UPON
DELIVERY OF AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
COMPANY THAT THE PROPOSED TRANSFER IS EXEMPT FROM THE ACT AND SUCH
LAWS.
6.3 Removal of Legends. Any legend endorsed on a certificate evidencing the
Shares shall be removed, and the Company shall issue a certificate without
such legend to the holder of such Shares, if such Shares are being sold
pursuant to an effective registration statement under the Securities Act or
pursuant to Rule 144 promulgated thereunder, and the purchaser thereof may
immediately resell such Shares without restriction and without
registration; provided, however, that in the case of a sale pursuant to
Rule 144, such holder of Shares shall provide such information as is
reasonably requested by the Company to ensure that such Shares may be sold
in reliance on Rule 144.
7. Termination; Liabilities Consequent Thereon. This Agreement may be
terminated and the transactions contemplated hereunder abandoned at any
time prior to the Closing only as follows:
(a) with respect to a Purchaser, by such Purchaser, upon notice to the
Company if the conditions set forth in Section 5.1 shall not have been
satisfied on or prior to December 27, 2003; or
15
(b) with respect to a Purchaser, by the Company, upon notice to such
Purchaser if the conditions set forth in Section 5.2 to be satisfied
by such Purchaser shall not have been satisfied on or prior to
December 27, 2003; or
(c) at any time by mutual agreement of the Company and Purchasers who
represent at least fifty percent (50%) of the Shares being sold
hereunder; or
(d) with respect to a Purchaser, by such Purchaser, if there has been any
breach of any representation or warranty or any material breach of any
covenant of the Company contained herein and the same has not been
cured within 15 days after notice thereof (it being understood and
agreed by each Purchaser that, in the case of any representation or
warranty of the Company contained herein which is not hereinabove
qualified by application thereto of a materiality standard, such
representation or warranty will be deemed to have been breached for
purposes of this Section 7.1(d) only if such representation or
warranty was not true and correct in all material respects at the time
such representation or warranty was made by the Company); or
(e) by the Company with respect to a Purchaser, if there has been any
breach of any representation, warranty or any material breach of any
covenant of such Purchaser contained herein and the same has not been
cured within 15 days after notice thereof (it being understood and
agreed by the Company that, in the case of any representation and
warranty of the Purchaser contained herein which is not hereinabove
qualified by application thereto of a materiality standard, such
representation or warranty will be deemed to have been breached for
purposes of this Section 7.1(e) only if such representation or
warranty was not true and correct in all material respects at the time
such representation or warranty was made by such Purchaser).
Any termination pursuant to this Section 7 shall be without liability on
the part of any party, unless such termination is the result of a material
breach of this Agreement by a party to this Agreement in which case such
breaching party shall remain liable for such breach notwithstanding any
termination of this Agreement.
8. Miscellaneous Provisions.
8.1 Use of Proceeds. The Company shall use the net proceeds from the sale
of the Shares for general corporate and working capital purposes and
may use a portion of such proceeds to retire certain debt obligations
of the Company.
8.2 Filings. The Company shall make all necessary filings with the SEC and
"blue sky" filings required to be made by the Company in connection
with the sale of the Shares to the Purchasers as required by all
applicable laws, and shall provide a copy thereof to the Purchasers
promptly after such filing.
8.3 Public Statements or Releases. Each of the parties to this Agreement
agrees that it shall not make, issue, or release any announcement,
whether to the public generally, or to any of its suppliers or
customers, with respect to this Agreement or the transactions provided
for herein, or make any statement or acknowledgment of the existence
of, or reveal the status of, this Agreement or the transactions
provided for herein, without the prior consent of the other parties,
which shall not be unreasonably withheld or delayed. Notwithstanding
the foregoing, nothing in this Section 8.3 shall prevent any party
hereto from making such public announcements or filings as it may
16
consider necessary in order to satisfy its legal obligations, or from
releasing a public statement acceptable to each of the parties hereto
upon the completion of the offering contemplated hereby. On or before
the third business day following the Closing Date, the Company will
issue a press release acceptable to each of the parties hereto
describing the transactions contemplated by this Agreement, and
promptly thereafter file a Current Report on Form 8-K with the SEC,
attaching such press release.
8.4 Further Assurances. The parties agree to cooperate fully to execute
such further instruments, documents and agreements and to give such
further written assurances, as may be reasonably requested by any
party to better evidence and reflect the transactions described herein
and contemplated hereby, and to carry into effect the intents and
purposes of this Agreement.
8.5 Notification of Effectiveness of Registration Statement. The Company
covenants that it will provide written notice to each Purchaser (which
notice may be in electronic form) that the Company's registration
statement on Form S-3 registering the Shares sold hereunder to the
Purchasers has been declared effective by the SEC, which notice shall
be given promptly after the Company has received notice of such
effectiveness from the SEC.
8.6 Rights Cumulative. Each and all of the various rights, powers and
remedies of the parties hereto shall be considered to be cumulative
with and in addition to any other rights, powers and remedies which
such parties may have at law or in equity in the event of the breach
of any of the terms of this Agreement. The exercise or partial
exercise of any right, power or remedy shall neither constitute the
exclusive election thereof nor the waiver of any other right, power or
remedy available to such party.
8.7 Pronouns. All pronouns or any variation thereof shall be deemed to
refer to the masculine, feminine or neuter, singular or plural, as the
identity of the person, persons, entity or entities may require.
8.8 Notices.
(a) Any notices, reports or other correspondence (hereinafter collectively
referred to as "correspondence") required or permitted to be given
hereunder shall be sent by postage prepaid first class mail, courier
or facsimile or delivered by hand to the party to whom such
correspondence is required
or permitted to be given hereunder. The date of giving any notice shall be the
date of its actual receipt.
(b) All correspondence to the Company shall be addressed as follows:
EP MedSystems, Inc.
000 Xxxxx 00 Xxxxx
Xxxxxxxx X
Xxxx Xxxxxx, Xxx Xxxxxx 00000-0000
Attention: President and Chief Executive Officer
Facsimile: (000) 000-0000
17
with a copy to:
Xxxxxx Xxxxxx White & XxXxxxxxx LLP
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
(c) All correspondence to any Purchaser shall be sent to such Purchaser at
the address set forth in Exhibit A.
(d) Any Person may change the address to which correspondence to it is to
be addressed by notification as provided for herein.
8.9 Captions. The captions and paragraph headings of this Agreement are
solely for the convenience of reference and shall not affect its
interpretation.
8.10 Severability. Should any part or provision of this Agreement be held
unenforceable or in conflict with the applicable laws or regulations
of any jurisdiction, the invalid or unenforceable part or provisions
shall be replaced with a provision which accomplishes, to the extent
possible, the original business purpose of such part or provision in a
valid and enforceable manner, and the remainder of this Agreement
shall remain binding upon the parties hereto.
8.11 Governing Law; Injunctive Relief.
(a) This Agreement shall be governed by and construed and enforced in
accordance with the internal and substantive laws of the State of New York
and without regard to any conflicts of laws concepts that would apply the
substantive law of any other jurisdiction.
(b) Each of the parties hereto acknowledges and agrees that damages will not be
an adequate remedy for any material breach or violation of this Agreement
if such material breach or violation would cause immediate and irreparable
harm (an "Irreparable Breach"). Accordingly, in the event of a threatened
or ongoing Irreparable Breach, each party hereto shall be entitled to seek,
in any state or federal court in the State of New York, equitable relief of
a kind appropriate in light of the nature of the ongoing or threatened
Irreparable Breach, which relief may include, without limitation, specific
performance or injunctive relief; provided, however, that if the party
bringing such action is unsuccessful in obtaining the relief sought, the
moving party shall pay the non-moving party's costs, including actual
attorney's fees, incurred in connection with defending such action. Such
remedies shall not be the parties' exclusive remedies, but shall be in
addition to all other remedies provided in this Agreement.
8.12 Waiver. No waiver of any term, provision or condition of this Agreement,
whether by conduct or otherwise, in any one or more instances, shall be
deemed to be, or be construed as, a further or continuing waiver of any
such term, provision or condition or as a waiver of any other term,
provision or condition of this Agreement.
18
8.13 Fees, Costs and Expenses. All fees, costs and expenses (including
attorneys' fees and expenses) incurred by any party hereto in connection
with the preparation, negotiation and execution of this Agreement and the
exhibits hereto and the consummation of the transactions contemplated
hereby and thereby (including the costs associated with any filings with,
or compliance with any of the requirements of, any governmental
authorities), shall be the sole and exclusive responsibility of such party.
Notwithstanding the foregoing, in the event of a Closing, the Company
agrees to reimburse, upon receipt by the Company of any itemized invoice,
each Purchaser for such Purchaser's reasonable out-of-pocket expenses and
legal fees incurred in connection with the transactions contemplated by
this Agreement; provided, however, the Company shall not be required to pay
in excess of $10,000 in the aggregate for all such expenses and legal fees
of all Purchasers taken together.
8.14 Assignment. The rights and obligations of the parties hereto shall inure to
the benefit of and shall be binding upon the authorized successors and
permitted assigns of each party. The Company shall not assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Majority Purchasers. Any Purchaser may assign its rights
under this Agreement to any person to whom the Purchaser assigns or
transfers any Shares, provided that such transferee agrees in writing to be
bound by the terms and provisions of this Agreement, and such transfer is
in compliance with the terms and provisions of this Agreement and
permitted, with the approval of counsel to the Company, by federal and
state securities laws..
8.15 Survival. The respective representations and warranties given by the
parties hereto, and the other covenants and agreements contained herein,
shall survive the Closing Date and the consummation of the transactions
contemplated herein for a period of two years, without regard to any
investigation made by any party.
8.16 Entire Agreement. This Agreement and exhibits attached hereto and
incorporated herewith constitute the entire agreement between the parties
hereto respecting the subject matter hereof and supersedes all prior
agreements, negotiations, understandings, representations and statements
respecting the subject matter hereof, whether written or oral.
8.17 Amendments. No modification, alteration, waiver or change in any of the
terms of this Agreement shall be valid or binding upon the parties hereto
unless made in writing and duly executed by the Company and (a) prior to
Closing, Purchasers who represent at least 66 2/3% of the Shares being sold
hereunder or (b) following Closing, Purchasers holding at least 66 2/3% of
the Shares; provided, however, that, in each case, no such amendment shall
increase the obligations of any Purchaser without such Purchaser's written
consent.
8.18 Confidential Information. Each of the Company and each Purchaser agrees to
keep confidential, and not to disclose to or use for the benefit of any
third party, the terms of this Agreement or any other information which at
any time is communicated by the other party as being confidential, without
the prior written approval of the other party; provided, however, that this
provision shall not apply to information which, at the time of disclosure,
is already part of the public domain (except by breach of this Agreement)
and information which is required to be disclosed by law (including,
without limitation, pursuant to Item 601(b)(10) of Regulation S-K under the
19
Securities Act and the Exchange Act) and provided further the Company will
not furnish confidential information to a Purchaser without (i) informing
such Purchaser regarding the nature of such information and (ii) receiving
the prior express written agreement of such Purchaser. Notwithstanding
anything herein to the contrary, any party to this Agreement (and any
employee, representative, or other agent of any party to this Agreement)
may disclose to any and all persons, without limitation of any kind, the
tax treatment and tax structure of the transactions contemplated by this
Agreement and all materials of any kind (including opinions or other tax
analyses) that are provided to it relating to such tax treatment and tax
structure. However, any such information relating to the tax treatment or
tax structure is required to be kept confidential to the extent necessary
to comply with any applicable federal or state securities laws.
8.19 Stock Splits, Dividends and other Similar Events. The provisions of this
Agreement shall be appropriately adjusted to reflect any stock split, stock
dividend, reorganization or other similar event that may occur with respect
to the Company after the date hereof.
8.19 Counterparts. This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[The remainder of this page has been intentionally left blank; signature page
follows.]
20
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the day and year first above written.
EP MedSystems, Inc.
By: /s/ Xxxxxxxx Xxxxxxx
Xxxxxxxx Xxxxxxx
President and Chief Executive Officer
THE PURCHASER'S SIGNATURE TO THE INVESTOR QUESTIONNAIRE DATED EVEN DATE HEREWITH
SHALL CONSTITUTE THE PURCHASER'S SIGNATURE TO THIS COMMON STOCK PURCHASE
AGREEMENT.
21
Exhibit A
------------------------------------------------------------------------------------------------------------------------------
AGGREGATE PURCHASE
PURCHASER NUMBER PRICE
ADDRESS OF SHARES TO BE PURCHASED ($)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
SF Capital Partners Ltd. c/o STARO Asset Management, LLC 1,000,000 2,560,000
0000 Xxxxx Xxxx Xx.
Xx. Xxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Catalysis Partners, LLC 000 Xxxxxxxx Xxxx. 75,000 192,000
Xxxxx Xxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
TCMP3 Partners c/o Titan Capital Management 80,000 204,800
0 Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
X.X. Xxxxxxxxx, Towbin Capital 000 Xxxxxxx Xxxxxx 250,000 640,000
Partners I, LP Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxx & Xxxxxxxx X. Xxxxxxxxx c/o X.X. Xxxxxxxxx, Towbin 50,000 128,000
Foundation Inc. 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxx c/o X.X. Xxxxxxxxx, Towbin 20,000 51,200
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxx ACF c/o X.X. Xxxxxxxxx, Towbin 5,000 12,800
Xxxxx X. Xxxx UGMA 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxx ACF c/o X.X. Xxxxxxxxx, Towbin 5,000 12,800
Xxxxxxx Xxxx UGMA 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxxx Xxxx 00 Xxxxxx Xxxxxx 20,000 51,200
Xxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxx X. Xxxxx SEP-XXX 000 Xxxxxxx Xxxxxxx 5,000 12,800
Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxxxx X. Xxxx 0000 Xxxxxx Xxxx 7,000 17,920
Xxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx X.X. Xxxx 00000 Xxxxxxxxxxx Xxxx 9,000 23,040
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxx X. Xxxxxx 0000 Xxxxxxxx Xxxxx 20,000 51,200
Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxx X. Xxxx 00000 Xxxxxxxxxxx Xxxx 15,000 38,400
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxx X. Xxxxxxx 0000 Xxxx Xxxxx 7,000 17,920
Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx X. Van Roijen 000 X. Xxxxxxx Xxxxxx 50,000 128,000
Xxxxx 000
Xxxxxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Patience Partners, LP 000 X. Xxxxxxx Xxxxxx 10,000 25,600
Xxxxx 000
Xxxxxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Oracle Offshore Ltd. c/o Ironshore Corp. Services, Ltd. 13,000 33,280
Queensgate House
So. Church Street, PO Box 1234
Georgetown, Grand Cayman,
Grand Cayman Islands
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxx Oracle Investments, Inc. 000 Xxxxxxxxx Xxxxxx 31,000 79,360
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Oracle Partners, LP 000 Xxxxxxxxx Xxxxxx 313,000 801,280
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Oracle Institutional Partners LP 000 Xxxxxxxxx Xxxxxx 90,000 230,400
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Blaze Corporation c/o Xxxxxxx Xxxxx 15,000 38,400
Royal Management
000 Xxxx Xxx.
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx X. Xxxxx 000 Xxxxx Xxxxxx 5,000 12,800
Xxx. 00X
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
J. Xxxxx Xxxxxxxxx 000 Xxxxxxx Xxxx Xxxx 10,000 25,600
Xxx. 00X
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Atlas Fund, LLC 000 X. Xxxxxxx, 00xx Xxxxx 1,000,000 2,560,000
Xxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxx X. Xxxxxx & Xxx X. Xxxxxx JTWROS 000 Xxxx Xxx Xxx., Xxx 00X 15,000 38,400
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxxx X. XxXxxx 00 Xxxx 00xx Xxxxxx, Xxx 0X 15,000 38,400
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxx X. XxXxxx 00 Xxxx 00xx Xxxxxx, Xxx 0X 15,000 38,400
Xxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxx X. Xxxxxxx TEE FBO: SAS Trust c/o Sampson Investments 20,000 51,200
I U/A/D 7/30/93 000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
Xxxxxx Xxxxxxxx Money Purchase Plan 41 Winged Foot Drive 20,000 51,200
Xxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------
Exhibit B
Form of Xxxxxx Xxxxxx White & XxXxxxxxx LLP
Opinion
See attached.
Exhibit C
Form of Investor Questionnaire
