DISCLOSURE SCHEDULE
This Disclosure Schedule, dated as of October 31, 2005 ( the
"Schedule"), is made and given pursuant to Article III and Article IV of the
Securities Purchase Agreement dated as of October 31, 2005 by and among Intraop
Medical Corporation and the purchasers named therein (the "Agreement"). Any
terms defined in the Agreement shall have the same meaning when used in this
Disclosure Schedule as when used in the Agreement unless the context otherwise
requires.
Notwithstanding anything to the contrary contained in this Schedule or
in the Agreement, the information and disclosures contained in each section of
this Schedule (including any schedules attached to this Schedule) shall be
deemed to be disclosed and incorporated by reference in each of the sections of
this Schedule as though fully set forth in such other sections (whether or not
specific cross-references are made) where it is reasonably apparent on the face
of the disclosure (without regard to the contents of any document referred to in
such disclosure and the contents of which are not expressly described or facts
and circumstances not expressly described or implied in such disclosure) that it
is applicable to such other sections, and shall be deemed to qualify and limit
all representations, warranties and covenants of the Company contained in the
Agreement.
Section 3.1(a)(b)
The Company's subsidiaries are:
1. Intraop Medical Services, Inc., a Delaware corporation, a wholly owned
subsidiary. The company is in good standing in Delaware, but is not in
good standing in California due to failure to pay California franchise
taxes. The Company is the sole stockholder.
2. IMS Louisville, LLC a Delaware limited liability corporation, of which
the Company is the sole member and manager. IMS Louisville is inactive
in Delaware, pending dissolution.
Section 3.1(g)
1. The capitalization of the Company consists of 100,000,000 shares of
authorized common stock, $0.001 par value, of which 20,126,135 shares are
outstanding. Included in the outstanding shares are 1,600,000 shares issued as
collateral for the 10% senior secured debentures issued on August 31, 2005 to
Regenmacher Holdings Ltd. and ABS SOS-Plus Partners Ltd., and 100,000 shares
issued to principals of The Investor Relations Group on August 26, 2005. No
other class of stock is authorized or outstanding.
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2. The Company has outstanding options exercisable 1,127,500 for shares of the
Company's common stock at prices ranging from $0.10 per share to $1.375 per
share.
3. The Company has outstanding warrants exercisable for 12,641,924 shares of the
Company's common stock at exercise prices ranging from $0.40 per share to $2.50
per share.
4. On August 31, 2005 and October 26, the Company issued to certain investors 7%
convertible debentures in the aggregate principal amount of $3,250,000,
convertible into common stock at an initial conversion price of $0.40 per share.
5. The Company received notices from shareholders representing all 97,000 shares
of common stock who had previously voted against the Merger that they wished to
redeem their shares in accordance with certain dissenter's rights provisions.
The estimated redemption value is $121,250 of which $30,000 has been paid.
Section 3.1(i)(ii)
On August 22, 2005 and August 26, 2005 and October 14, 2005, the Company became
obligated under notes in the principal amount of $237,500 from ▇▇▇▇▇▇ ▇. ▇▇▇▇,
its CEO and Chairman. The notes are unsecured and bear interest at 9% per annum
and are to be repaid when the finances of the Company permit and have not been
disclosed in filings with the SEC. Original principal of $50,000 of these notes
remain outstanding.
Section 3.1(n)
1. All of the assets of the Company are subject to a lien and security interest
which secures the 10% senior secured debentures issued on August 31, 2005.
2. Pursuant to a Factoring Agreement dated February 24, 2005 ("Factoring
Agreement") in the principal amount of $1,060,000, the Company has pledged its
right, title and interest in its Mobetron S/N 13 and all contracts or proceeds
related to the unit, including its contemplated contract for sale of the unit to
the University of Heidleburg, to E.U. Capital Venture, Inc., a Nevada
corporation ("EU Venture").
3. In October 2004, the Company entered into an inventory repurchase agreement
with a EU Venture (the "First EU Repurchase Agreement"). Under the terms of the
agreement, EU Venture placed an order for Mobetron S/N 15 (the "Financed
Mobetron") with CDS Engineering LLC ("CDS") and gave a deposit to CDS of
$525,000 towards the purchase of that Mobetron. In January 2005, the Company
entered into an inventory repurchase agreement with EU Venture (the "Second EU
Repurchase Agreement"). Under the terms of the agreement, the EU Venture placed
an order for Mobetron S/N 14 (the "Second Financed Mobetron") with CDS and gave
a deposit to CDS of $540,000 towards the purchase of that Mobetron. In April
2005, the Company entered into an inventory repurchase agreement with EU Venture
(the "Third EU Repurchase Agreement"). Under the terms of the agreement, the EU
Venture placed an order for a Mobetron S/N 15 (the "Third Financed Mobetron")
with the Company and gave a deposit to the Company of $562,000 towards the
purchase of that Mobetron. The Financed Mobetron, the Second Financed Mobetron
and the Third Financed Mobetron are subject to a lien by EU Venture.
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4. On August 16, 2005, the Company entered in to an Inventory/Factoring
Agreement with E.U.C. Holding and EU Venture (the "EU Line"). The Company
anticipates that inventory and contracts currently financed under the Factoring
Agreement, the First EU Repurchase Agreement, the Second EU Repurchase Agreement
and the Third EU Repurchase Agreement will be refinanced under the EU Line and
be subject to liens under EU Line.
Section 3.1(p)
The Company's directors and officer's insurance coverage in the amount of
$3,000,000 is less than the anticipated Subscription Amount.
Section 3.1(q)
The Company has entered into certain loan agreements with its officers and
directors as described in Section 3.1(i)(ii) above.
Section 3.1(r)
The Company is in material compliance with the disclosure controls and
procedures provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002. The internal accounting
controls provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 are not yet applicable to
the Company and the Company may not be in material with all of such provisions.
However, the Company is working to insure that it is in compliance with such
provisions when they become applicable to the Company.
Section 3.1(s)
The Company has entered into Placement Agency Agreement dated May 17, 2005
("Agency Agreement") with Stonegate under which the consummation of the
transactions contemplated by the Transaction Documents are subject to certain
fees and other compensation being paid to Stonegate.
Specifically, Stonegate is entitled under the agreement to receive, at closing
of the contemplated transactions:(i) proceeds equal 7% of the Subscription
Amount (the "Fee Amount"), (ii) a number of warrants equal to the Fee Amount
divided by initial Conversion Price and which warrant shall be substantially
similar in the form of Exhibit 3.1(s) and (iii) reimbursement of reasonable
out-of-pocket expenses of Stonegate up to an aggregate maximum of $20,000.
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Section 3.1(v)
The Company has granted registration rights to the investors who purchased the
7% convertible debentures and the 10% senior secured debentures on August 31,
2005 and October 26, 2005.
Section 3.1(y)
The Company has disclosed to Alpha Capital AG and Crestview Capital Master, LLC
information that constitutes or might constitute material, nonpublic information
pursuant to nondisclosure agreements executed by such Purchasers, including but
not limited to, detailed sales and manufacturing projections and forecasts,
detailed financial projections, lists of holders and their holdings of the
Company's stock, warrants, options, and debt and accounts payable, and
agreements pursuant to those holdings.
Section 3.1(aa)
Except as disclosed in Section 3.1(h) above, the SEC Reports set forth all
outstanding secured and unsecured Indebtedness of the Company or any Subsidiary,
or for which the Company or any Subsidiary has commitments.
Section 3.1(ee)
The Company's certified public accountants at the time of the issuance of the
10-KSB for the year ended December 31, 2004 were ▇▇▇▇▇▇ and Associates CPA's,
Inc. Subsequent to the Merger, the Company retained Stonefield ▇▇▇▇▇▇▇▇▇, Inc.,
as its accountants. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Inc. resigned as the Company's
certified public accountants on September 12, 2005.
Section 3.1(ff)
The 10% senior secured debentures issued on August 31, 2005 to Regenmacher
Holdings and ABS SOS-Plus Partners Ltd. and certain inventory financing will be
senior to the Debentures upon liquidation or dissolution.
Section 3.1(gg)
As of June 30, 2005 the Company has outstanding invoice from DLA ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ US LLP ("▇▇▇▇ ▇▇▇▇") totaling approximately $446,781 for legal
services. The Company has asked ▇▇▇▇ ▇▇▇▇ to adjust its ▇▇▇▇▇▇▇▇ to the Company
due to certain disagreements over the invoiced amounts.
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Schedule 4.9
A. The following Indebtedness will remain outstanding following the close:
1. The 7% convertible debentures issued on August 31, 2005 and October
26, 2005.
2. The 10% senior secured debentures issued on August 31, 2005.
3. To the extent not refinanced under the EU Line: outstanding
indebtedness under the Factoring Agreement, the First EU Repurchase
Agreement, the Second EU Repurchase Agreement and the Third EU
Repurchase Agreement.
4. Indebtedness under the EU Line.
5. Promissory notes shown on Exhibit 4.9(a).
B. The Indebtedness shown on Exhibit 4.9(b) and 4.9(c) will be repaid
contemporaneous with or immediately following the Closing.
C. The remainder of any proceeds from the Closing may be used for any
legitimate corporate purpose including the satisfaction of outstanding
trade payables.
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Exhibit 4.9(a) -- Remain Outstanding Following Close
Individual Related Party Promissory Notes
Interest Calculation Dates
Calc Date 10/28/05
Last Paid 12/31/01
Deposit Int. Owed
Name Amount Int. Rate Note Date Date From Int Due Total Out.
----------------------- -------------- ----------- ---------- ----------- ------------ ------------- ----------------
▇▇▇▇▇▇ ▇. ▇▇▇▇ 642,754.60 9.00% 9/30/04 9/30/04 9/30/04 64,732.46 707,487.06
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ 164,670.75 9.00% 9/30/04 9/30/04 9/30/04 16,584.16 181,254.91
▇▇▇▇▇▇ ▇. ▇▇▇▇ 25,000.00 9.00% 6/9/05 6/9/05 6/9/05 877.66 25,877.66
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ 10,000.00 9.00% 7/21/05 7/21/05 7/21/05 245.80 10,245.80
▇▇▇▇▇▇ ▇. ▇▇▇▇ 25,000.00 9.00% 7/22/05 7/22/05 7/22/05 608.34 25,608.34
▇▇▇▇ ▇▇▇▇▇▇ 5,000.00 9.00% 7/28/05 7/28/05 7/28/05 114.27 5,114.27
▇▇▇ ▇▇▇▇▇▇▇▇ 5,000.00 9.00% 8/1/05 8/1/05 8/1/05 108.77 5,108.77
▇▇▇▇▇▇ ▇. ▇▇▇▇ 60,000.00 9.00% 8/1/05 8/1/05 8/1/05 1,305.29 61,305.29
----------------------- -------------- ----------- ---------- ----------- ------------ ------------- ----------------
Total 937,425.35 84,576.76 1,022,002.11
======================= ============== =========== ========== =========== ============ ============= ================
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Exhibit 4.9(b) -- Repay from Proceeds
Individual Related Party Promissory Notes
Interest Calculation Dates
Calc Date 10/28/05
Last Paid 12/31/01
Deposit Int. Owed
Name Amount Int. Rate Note Date Date From Int Due Total Out.
---------------------- --------------- ----------- ------------ ------------ ------------ ------------- ------------
▇▇▇▇▇▇ ▇. ▇▇▇▇ 50,000.00 9.00% 10/14/05 10/14/05 10/14/05 172.60 50,172.60
---------------------- --------------- ----------- ------------ ------------ ------------ ------------- ------------
Total 50,000.00 172.60 50,172.60
====================== =============== =========== ============ ============ ============ ============= ============
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Exhibit 4.9(c) -- Repay from Subsequent Close
Individual Third Party Promissory Notes
Interest Calculation Dates
Calc Date 10/28/05
Last Paid 12/31/01
Deposit Int. Owed
Name Amount Int. Rate Note Date Date From Int Due Total Out.
-------------------- --------------- ------------ ------------ ------------ ------------ -------------- ------------
▇▇▇▇▇▇ ▇▇▇▇▇ 50,000.00 9.00% 9/30/95 9/30/95 12/31/01 20,332.08 70,332.08
-------------------- --------------- ------------ ------------ ------------ ------------ -------------- ------------
Total 50,000.00 20,332.08 70,332.08
==================== =============== ============ ============ ============ ============ ============== ============
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SCHEDULE 6(b) to REGISTRATION RIGHTS AGREEMENT
This Schedule 6(b), dated as of October 31, 2005 ( the "Schedule"), is
made and given pursuant to Article 6(b) of the Registration Rights Agreement
dated as of October 31, 2005 by and among Intraop Medical Corporation and the
purchasers named therein (the "Agreement"). Any terms defined in the Agreement
shall have the same meaning when used in this Disclosure Schedule as when used
in the Agreement unless the context otherwise requires.
In addition to the Registrable Securities, the Company's Initial
Registration will include:
1. Shares issuable upon conversion of the 7% convertible debentures issued on
August 31, 2005 and October 26, 2005.
2. All of the Company's outstanding common stock except 345,000 shares issued to
Summit Financial Partners, L.L.C or its employees or affiliates pursuant to the
close of the Company's merger on March 9, 2005.
3. Holders of outstanding warrants exercisable for 12,641,924 shares of the
Company's common stock.
4. Holders of outstanding options exercisable 1,127,500 for shares of the
Company's common stock.
5. Warrants for shares of the Company's common stock which may be granted in
relation to this close or a subsequent close to Stonegate Securities, Inc., a
Texas corporation ("Stonegate") as the holder of in relation to a Placement
Agreement between Stonegate and the Company dated May 17, 2005.
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