Exhibit 10c
SECOND AMENDMENT TO CONVERTIBLE
DEBENTURE PURCHASE AGREEMENT
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THIS SECOND AMENDMENT TO CONVERTIBLE DEBENTURE PURCHASE
AGREEMENT dated as of August [ ], 1997, is made by and among PLC Systems Inc.
(the "Company"), Soutbrook International Investments, Ltd. ("Southbrook"), HBK
Cayman L.P. ("HBK Cayman"), HBK Offshore Fund Ltd. ("HBK Offshore") and Xxxxx
Xxxxxxx Strategic Growth Fund, LP. ("Xxxxx Xxxxxxx"). Southbrook, HBK Cayman and
HBK Offshore are each sometimes referred to herein as a "Initial Purchaser" and
collectively as the "Initial Purchasers" and together with Xxxxx Xxxxxxx, the
"Purchasers".
WHEREAS, the Company and the Initial Purchasers are parties to
a certain Convertible Debenture Purchase Agreement, dated as of July 17, 1997,
as amended to include Xxxxx Xxxxxxx, dated as of July 22, 1997 (the "Purchase
Agreement"), pursuant to which, among other things, the Company issued and sold
to the Purchasers 5% Convertible Debentures, due July 17, 2002 (the "Tranche 1
Debentures") and 5% Convertible Debentures, due July 22, 2002; and
WHEREAS, capitalized terms not otherwise defined herein shall
have the definitions set forth in the Purchase Agreement.
WHEREAS, the parties hereto desire to amend and modify the
Purchase Agreement as set forth herein.
IN CONSIDERATION of the mutual covenants and agreements set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. The Tranche 2 Closing. The Purchasers hereby agree to waive the
provisions of Section 1.2(b) and the conditions of Sections 4.1 (b) (to the
extent specifically set forth herein), (d), (f) (to the extent specifically set
forth herein), and (i) of the Purchase Agreement in order to allow the Company
to deliver a Subsequent Tranche Notice, on the date hereof, requiring the
Purchasers to purchase Convertible Debentures in such aggregate principal amount
up to $10,075,000 as the Company may designate in such Subsequent Tranche
Notice.
2. Representations and Warranties of the Company. Section 2.1(d) of the
Purchase Agreement is hereby amended and modified as follows:
The Convertible Debentures and the Warrants are duly authorized, and,
when issued and paid for in accordance with the terms hereof, shall be
validly issued, fully paid and nonassessable. The Company, as at the
Tranche 1 Closing Date and Tranche 2 Closing Date, as the case may be
(each, a "Closing Date" and, collectively, the "Closing Dates"), has
and at all times while the Convertible
Debentures and the Warrants are outstanding will maintain an adequate
reserve of duly authorized shares of Common Stock to enable it to
perform its conversion, exercise and other obligations under this
Agreement, the Warrants and the Convertible Debentures, and in no
circumstances shall such reserved and available shares of Common Stock
be less than the sum of (i) 2,515,000 shares of Common Stock (or
3,015,000 shares of Common Stock as provided in Section 4 herein) for
issuance upon conversion of the Tranche 1 Debentures and Tranche 2
Debentures and to enable the Company to pay interest on the Tranche 1
Debentures and Tranche 2 Debentures and (ii) the number of shares of
Common Stock which would be issuable upon exercise in full of the
Tranche 1 Warrants and Tranche 2 Warrants. The Company and the
Purchasers agree that all penalty interest, liquidated damages and
early redemption or repayment amounts payable pursuant to any
Transaction Documents shall be paid in cash unless otherwise consented
to by the Purchasers. The shares of Common Stock issuable upon
conversion of Convertible Debentures and upon exercise of the Warrants
and payable as interest on the Debentures are collectively referred to
herein as the "Underlying Shares." When issued in accordance with the
terms of the Convertible Debentures and the Warrants, the Underlying
Shares will be duly authorized, validly issued, fully paid and
nonassessable. The Convertible Debentures, Warrants and Underlying
Shares are collectively referred to herein as the "Securities."
3. Listing and Reservation of Underlying Shares. Section 3.8(a) of the
Purchase Agreement is hereby amended and modified as follows:
The Company shall (a) not later than the fifth Business Day following
the Tranche 2 Closing Date prepare and file with the American Stock
Exchange (as well as any other national securities exchange or market
on which the Common Stock is then listed or traded) an additional
shares listing application covering at least the sum of 2,665,000
Underlying Shares (or 3,165,000 Underlying Shares as provided in
Section 4 herein) (comprised of 2,515,000 shares (or 3,015,000 shares
as provided in Section 4 herein) reserved for issuance upon conversion
of Tranche 1 Debentures, Tranche 2 Debentures and the payment of
interest thereon (but not penalty interest, for which the Company shall
reserve additional shares), subject to Section 2.1(d) herein, and
150,000 shares reserved for issuance upon exercise of Tranche 1
Warrants and Tranche 2 Warrants); (b) take all steps necessary to cause
such shares to be approved for listing in the American Stock Exchange
(as well as on any other national securities exchange or market on
which the Common Stock is then listed) as soon as possible thereafter;
and (c) provide to the Purchasers evidence of such listing, and the
Company shall maintain the listing of its Common Stock on such
exchange. If the Tranche 2 Warrants are issued and delivered on or
after the Tranche 2 Closing Expiration Date, the Company shall (not
later than five Business Days thereafter) prepare and file with the
American Stock Exchange (as well as any other national
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securities exchange or market on which the Common Stock is then listed
or traded) an additional shares listing application covering the number
of Underlying Shares issuable upon exercise in full of the Tranche 2
Warrants, and take all steps necessary to cause such shares to be
approved for listing thereon as soon as possible thereafter.
4. Registration of Underlying Shares. The Company has agreed to file a
registration statement covering 2,665,000 Underlying Shares (including shares
reserved for issuance upon conversion of the Tranche 1 Debentures, Tranche 2
Debenture and the payment of interest thereon, and shares reserved for issuance
on exercise of the Tranche 1 Warrants and the Tranche 2 Warrants) following the
Tranche 2 Closing in accordance with the Registration Rights Agreement dated
July 17, 1997 among the parties hereto (the "Registration Rights Agreement").
The Company agrees that at any time after this date if either (i) the Company
receives a recommendation of non-approval of its Pre-Market Application for its
Heart Laser System from the Circulatory Systems Advisory Panel of the U.S. Food
and Drug Administration (the "Panel"), or (ii) the Company does not receive a
recommendation of approval of its Pre-Market Application for its Heart Laser
System from the Panel or from the United States Food and Drug Administration by
August 14, 1998, then the maximum number of shares of Common Stock which the
Company shall be obligated to issue upon conversion of the Tranche 1 Debentures
and Tranche 2 Debentures shall be increased from 2,515,000 to 3,015,000. At the
request of any of the Purchasers the Company shall immediately file an
additional registration statement in accordance with the terms of the
Registration Rights Agreement with respect to an additional 500,000 Underlying
Shares.
5. Additional Information. The Company hereby advises the Purchasers of
the following additional developments since July 17, 1997 which have been
disclosed in press releases and which will be stated in the Company's Form 10-Q
filing to be filed with the Securities and Exchange Commission by the end of the
business day on August 14, 1997:
(a) On July 28, 1997, the Panel, by a vote of 9 to 2, voted
against recommending Pre-Market Approval of the Heart Laser System at this time.
There can be no assurance as to when, if ever, the Company will obtain
Pre-Market Approval from the Panel. Although the Company's plans are to submit
additional 12-month follow-up patient data from its Phase III studies to the
U.S. Food and Drug Administration as soon as possible, it is impossible to
ascertain at this time if the U.S. Food and Drug Administration will consider
such data adequate to resubmit the application for Pre Market Approval to the
Panel and to ultimately grant PMA for the Heart Laser System. There can be no
assurance that the Company's Heart Laser System will receive PMA approval on a
timely basis, if at all.
(b) Subsequent to the July 28, 1997 Panel meeting, the Company
and certain of its officers have been named as defendants in eleven purported
class action lawsuits each filed in August 1997 in the United States District
Court for the District of Massachusetts. The suits allege violations of federal
securities laws. The plaintiffs are seeking damages in connection with such
alleged violations. Although the outcome of these suits is not currently
predictable,
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management believes that the Company has meritorious defenses, and intends to
vigorously defend the suits.
6. Miscellaneous.
(a) The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.
(b) This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York without
regard to the principles of conflicts of law thereof.
(c) This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first indicated above.
PLC SYSTEMS INC.
By:
---------------------------------
Name:
Title:
SOUTHBROOK INTERNATIONAL
INVESTMENTS, LTD.
By:
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Name:
Title:
HBK CAYMAN L.P.
By:
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Name:
Title:
HBK OFFSHORE FUND LTD.
By:
---------------------------------
Name:
Title:
XXXXX XXXXXXX STRATEGIC GROWTH
FUND, LP
By: Xxxxx Xxxxxxx Capital, LLC
General Partner
By:
---------------------------------
Name:
Title:
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