AMENDMENT TO
STOCK PURCHASE AGREEMENT
AMENDMENT TO STOCK PURCHASE AGREEMENT (the "Amendment") dated as of
December 31, 1998, by and between NORLAND MEDICAL SYSTEMS B.V., a Netherlands
corporation ("Seller"), and NORLAND MEDICAL SYSTEMS, INC., a Delaware
corporation ("Buyer").
WHEREAS, Seller and Buyer are parties to that certain Stock Purchase
Agreement, dated as of February 26, 1997, as previously amended (as so amended,
the "Stock Purchase Agreement"), pursuant to which on September 11, 1997 Buyer
purchased from Seller all of the issued and outstanding shares of the Common
Stock, par value $1.00 per share (the "Shares"), of Norland Corporation; and
WHEREAS, the Seller and the Buyer have agreed to make certain
amendments to the Stock Purchase Agreement, to the extent set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Seller and Buyer hereby agree as follows:
1. Definitions. All capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to such terms in the Stock Purchase
Agreement.
2. Purchase Price.
(a) The aggregate Purchase Price for the Shares paid by Buyer
to Seller was $17,500,000, consisting of (i) $1,250,000 in cash, and (ii) the
$16,250,000 Purchase Note. Buyer and Seller hereby agree that the aggregate
Purchase Price for the Shares is reduced by $8,800,000 to $8,700,000 consisting
of (i) the $1,250,000 in cash paid by Buyer to Seller at the Closing, (ii)
7,000,000 shares of the Common Stock of Buyer issued by converting $1,890,000
principal amount of the Purchase Note pursuant to Section 1.02(b) of the Stock
Purchase Agreement, and (iii) the balance by an amended Purchase Note in the
principal amount of $5,560,000.
(b) The form of the amended Purchase Note (the "Amended Note")
is attached to this Amendment as Exhibit A. Simultaneously with the execution
and delivery of this Amendment, (i) $1,890,000 in principal amount of the
Purchase Note is being converted into 7,000,000 shares of Buyer's Common Stock,
(ii) Buyer is executing and delivering the Amended Note to Seller, and (iii) the
balance of the original Purchase Note is being cancelled. The Amended Note shall
bear interest from the date hereof at the rate of 6 1/2 per annum. The accrued
and unpaid interest on the original Purchase Note as of the date hereof in the
aggregate amount of $575,000 (the "Accrued Interest") shall be paid by Buyer to
Seller as follows:
(A) $287,500 shall be payable on January 4, 1999; and
(B) the remaining Accrued Interest of $287,500 shall be
payable in equal monthly installments of $23,958.33 commencing
on January 31, 1999 and on the last day of each succeeding
month to and including December 31, 1999.
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If the Buyer shall fail to pay any installment of Accrued Interest within five
business days of its due date, Seller may, by written notice to Buyer, declare
any portion of the Amended Note held by Seller to be due and payable.
(c) The aggregate of 7,000,000 shares of the Common Stock of
Buyer issued as provided in Section 2(a) of this Amendment constitute Payment
Shares and Registration Stock for purposes of the Stock Purchase Agreement.
3. Pledge Agreement. The Pledge Agreement is being amended by
that certain Amendment to Pledge Agreement dated as of the date hereof in the
form of Exhibit B attached hereto.
4. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall be deemed an original, but which together
shall constitute one and the same instrument.
5. Ratification. Except as specifically amended herein, the
terms and provisions of the Stock Purchase Agreement are in all respects
ratified and confirmed.
IN WITNESS WHEREOF, the parties have caused this Amendment to
be executed as of the day and year first above written.
NORLAND MEDICAL SYSTEMS B.V.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
NORLAND MEDICAL SYSTEMS, INC.
By: /s/ Xxxx X. Streams
-------------------------------------
Name: Xxxx X. Streams
Title: Vice President, Finance
EXHIBIT A
THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT
AND HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 OR THE SECURITIES
LAWS OF ANY STATE. THIS NOTE MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN OPINION OF COUNSEL
SATISFACTORY TO THE ISSUER THAT SUCH
REGISTRATION IS NOT REQUIRED BY SAID ACT
OR STATE LAWS.
NORLAND MEDICAL SYSTEMS, INC.
$5,560,000 White Plains, New York
December 31, 1998
NORLAND MEDICAL SYSTEMS, INC., a Delaware corporation (the
"Company"), for value received, promises to pay to NORLAND MEDICAL SYSTEMS B.V.,
a Netherlands corporation (the "Payee"), the principal sum of Five Million Five
Hundred Sixty Thousand Dollars ($5,560,000) on September 11, 2002 (the "Maturity
Date"), except as otherwise provided herein, together with interest on the
outstanding principal amount of this Note at the rate of six and one-half
percent (6-1/2%) per annum, except as otherwise provided herein. Interest shall
be payable quarterly on the last business day of each March, June, September and
December, commencing March 31, 1999. If the entire principal amount of this Note
is not paid in full on or before the Maturity Date, the Company may elect to
extend the Maturity Date for an additional period of two years (the "Extension
Period"). If the Company so elects to extend the Maturity Date, then effective
on September 11, 2002 and on each succeeding September 11 during the Extension
Period, the interest rate on this Note shall be increased by one percentage
point.
This Note is the Purchase Note issued by the Company pursuant to a
Stock Purchase Agreement dated as of February 26, 1997 between the Company and
the Payee, as amended (as so amended, the "Purchase Agreement"). This Note is
secured by a Pledge Agreement dated as of September 11, 1997 between the Company
and the Payee, as amended (as so amended, the "Pledge Agreement").
1. Payments and Prepayments.
1.1 Payments and prepayments of principal and interest on this Note
shall be made to Payee at 000 Xxxxxxxxx Xxxx Xxxxx, Xxxxx 000, Xxxxx Xxxxxx, Xxx
Xxxx 00000, or such other place or places within the United States as may be
specified by the holder of this Note in a written notice to the Company at least
10 business days before a given payment date.
1.2 Payments and prepayments of principal and interest on this Note
shall be made in lawful money of the United States of America; provided,
however, that except for the mandatory prepayment referred to in the first
sentence of Section 1.4 below, the Company shall have the right to make any
payment or prepayment of principal on this Note by delivering to the holder of
this Note shares of the Common Stock, par value $.0005 per share, of the Company
("Common Stock") registered in such holder's name (the
"Payment Shares"). A Payment Share shall, for such purpose, be valued at the
average of the closing prices for a share of the Common Stock on each of the
five trading days preceding such payment or prepayment.
1.3 If any payment on this Note becomes due and payable on a
Saturday, Sunday or other day on which commercial banks in New York City are
authorized or required by law to close, the maturity thereof shall be extended
to the next succeeding business day, and, with respect to payments of principal,
interest thereon shall be payable during such extension at the then applicable
rate.
1.4 The Company shall be obligated to make a principal payment of
$1,250,000 within ten (10) days after such time as the Company receives net
proceeds of at least $2,000,000 from a debt or equity financing. The Company
shall have the right at any time and from time to time to prepay this Note in
whole or in part, together with interest on the amount prepaid to the date of
prepayment, without penalty or premium. Upon payment of part of the principal
amount of this Note, the Company may require the holder to present this Note for
notation of such payment and, if this Note is paid in full, require the holder
to surrender this Note.
1.5 Upon payment in full of all outstanding principal and interest
due under this Note, the Company's obligations in respect of payment of this
Note shall terminate and the holder shall return it to the Company.
2. Setoff Rights. Payee, for itself, its successors and assigns,
covenants and agrees, and each holder of this Note by its acceptance of this
Note likewise covenants and agrees, that the payment of the principal of this
Note is expressly subject to the setoff rights of the Company to the extent and
in the manner provided in the Purchase Agreement.
3. Events of Default. In the event that:
(a) the Company defaults for more than five business days in
making any payment required to be made on this Note;
(b) a Default shall have occurred and be continuing under the
Pledge Agreement; or
(c) the Company hereafter makes an assignment for the benefit
of creditors, or files a petition in bankruptcy as to itself, is
adjudicated insolvent or bankrupt, petitions or applies to any
tribunal for the appointment of any receiver of or any trustee for
the Company or any substantial part of its property under any
bankruptcy, reorganization, arrangement, readjustment of debt,
dissolution or liquidation law or statute of any jurisdiction,
whether now or hereafter in effect; or if there is hereafter
commenced against the Company any such proceeding and an order
approving the petition is entered or such proceeding remains
undismissed for a period of 60 day, or the Company or its general
partner by any act or omission to act indicates its consent to or
approval of or acquiescence in any such proceeding or the
appointment of any receiver of, or trustee for, the Company or any
substantial part of its property, or suffers any such receivership
or trusteeship to continue undischarged for a period of 60 days;
then, and in any such event, and at any time thereafter, if such event shall
then be continuing, the holder of this Note may, by written notice to the
Company, declare the Note due and payable, whereupon the same
shall be due and payable without presentment, demand, protest or other notice of
any kind, all of which are hereby expressly waived.
4. Investment Representation.
4.1 The Payee hereby acknowledges that the Note is not being
registered (i) under the Securities Act of 1933, as amended (the "Act"), on the
ground that the issuance of the Note is exempt from registration under Section
4(2) of the Act as not involving any public offering or (ii) under any
applicable state securities law because the issuance of the Note does not
involve any public offering; and that the Company's reliance on the Section 4(2)
exemption of the Act and under applicable state securities laws is predicated in
part on the representations hereby made to the Company by the Payee that it is
acquiring the Note for investment for its own account, with no present intention
of dividing its participation with others or reselling or otherwise distributing
the same, subject, nevertheless, to any requirement of law that the disposition
of its property shall at all times be within its control.
4.2 The Payee hereby agrees that it will not sell or transfer all or
any part of this Note unless and until it shall first have given notice to the
Company describing such sale or transfer and furnished to the Company an
opinion, reasonably satisfactory to counsel for the Company, of counsel skilled
in securities matters (selected by the holder and reasonably satisfactory to the
Company) to the effect that the proposed sale or transfer may be made without
registration under the Act and without registration or qualification under any
state.
4.3 The Company may refuse to recognize a transfer of this Note on
its books should a holder attempt to transfer this Note otherwise than in
compliance with this Section 4.
5. Miscellaneous.
5.1 Upon receipt of evidence reasonably satisfactory to the Company
of the loss, theft, destruction or mutilation of this Note and of a letter of
indemnity reasonably satisfactory to the Company, and upon reimbursement to the
Company of all reasonable expenses incident thereto, and upon surrender or
cancellation of the Note, if mutilated, the Company will make and deliver a new
Note of like tenor in lieu of such lost, stolen, destroyed or mutilated Note.
5.2 This Note and the rights and obligations of the Company and each
holder hereunder shall be construed in accordance with and be governed by the
laws of the State of New York.
IN WITNESS WHEREOF, the Company has executed this Note as of the day
and year first above written.
NORLAND MEDICAL SYSTEMS, INC.
By:
-------------------------------------
Name: Xxxx X. Streams
Title: Vice President, Finance
EXHIBIT B
AMENDMENT TO PLEDGE AGREEMENT
AMENDMENT TO PLEDGE AGREEMENT (the "Amendment") dated as of December
31, 1998, by and between NORLAND MEDICAL SYSTEMS, INC., a Delaware corporation
("Pledgor"), and NORLAND MEDICAL SYSTEMS B.V., a Netherlands corporation
("Pledgee").
WHEREAS, the Pledgor and the Pledgee are parties to that certain
Pledge Agreement, dated as of September 11, 1997 (the "Pledge Agreement"),
pursuant to which the Pledgor has pledged to the Pledgee, as security for the
Notes (as defined in the Pledge Agreement), all of the issued and outstanding
shares of the Common Stock, $1.00 par value (the "Shares"), of Norland
Corporation, a Wisconsin corporation; and
WHEREAS, the Pledgor purchased the Shares form the Pledgee pursuant
to a Stock Purchase Agreement dated as of February 26, 1997, as amended prior to
the date hereof (as so amended, the "Stock Purchase Agreement"); and
WHEREAS, the Stock Purchase Agreement is being further amended by an
Amendment dated as of the date hereof (the "December 1998 Amendment") to, among
other things, reduce the purchase price paid by the Pledgor for the Shares; and
WHEREAS, the Pledgor and the Pledgee desire to amend the Pledge
Agreement to the extent set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Pledgor and the Pledgee hereby agree as
follows:
1. Capitalized terms used herein and not otherwise defined shall
have the meanings ascribed to such terms in the Pledge Agreement.
2. Pursuant to the Stock Purchase Agreement, (a) the Pledgor issued
to the Pledgee the $16,250,000 Purchase Note as part of the purchase price for
the Shares and (b) the Pledgor would have been obligated, under certain
circumstances, to issue an additional Note in a principal amount up to
$2,500,000. The Purchase Note and the Additional Note are referred to
collectively in the Pledge Agreement as the Notes. The Pledgor did not become
obligated to issue an Additional Note to the Pledgee, and, pursuant to the
December 1998 Amendment, the principal amount of the Purchase Note (after giving
effect to the conversion of a portion of the principal amount into 7,000,000
shares of the Pledgor's Common Stock) is being reduced to $5,560,000. A copy of
the amended Purchase Note (the "Amended Note") is attached as Exhibit A to the
December 1998 Amendment.
3. The Pledgor and the Pledgee hereby agree that from and after the
date hereof, the term "Notes", as used in the Pledge Agreement, shall refer to
the Amended Note.
4. This Amendment may be executed in two or more counterparts, each
of which shall be deemed an original, but which together shall constitute one
and the same instrument.
5. Except as specifically amended herein, the terms and provisions
of the Pledge Agreement are in all respects ratified and confirmed.
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed as of the day and year first above written.
NORLAND MEDICAL SYSTEMS, INC.
By:
-------------------------------------
Name: Xxxx X. Streams
Title: Vice President, Finance
NORLAND MEDICAL SYSTEMS B.V.
By:
-------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Director
