Exhibit 2.3
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is dated as of the 6th day
of February, 2002 ("Effective Date"), by and between Xxxx X. Xxxx, M.D., an
individual, and any person or entity that directly, or indirectly through one or
more intermediaries, controls or is controlled by or is under common control
with Xx. Xxxx (collectively, "Assignor") and Endocare, Inc., a Delaware
corporation (the "Company").
WHEREAS, the Company is a medical device company in the business of
developing urological healthcare technologies with the potential to dramatically
improve men's health and quality of life.
WHEREAS, Assignor is a medical physician by trade, but during a period
ended at least one year prior to the date hereof Assignor developed intellectual
property rights, hereinafter described, as a by-product of his profession as a
physician, and the parties acknowledge that Assignor is not and never has been a
professional developer of intellectual property rights or know-how.
WHEREAS, pursuant to the terms and conditions of this Agreement,
Assignor wishes to sell to the Company, and the Company desires to purchase from
Assignor all of Assignor's right, title and interest in and to all of Assignor's
intellectual property rights related to clinical experience and proprietary
surgical techniques relating to the fields of cryosurgery, nerve-sparing
cryosurgical procedures, tissue ablation (excluding electroporation) and
urological imaging (excluding electrical impedance tomography).
WHEREAS, in connection with the sale of the assets, Xx. Xxxx will
continue his service as a consultant of the Company.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Purchase and Sale. Pursuant to the terms set forth herein, Assignor
hereby sells, assigns, transfers and conveys to the Company, and the Company
purchases and accepts, all of Assignor's right, title and interest throughout
the world in and to all industrial and intellectual property rights relating to
the "Technology" as used in the Business (as defined in Section 16, below)
(collectively, "Rights") (as such "Technology" is described in Schedule A),
including but not limited to the following:
(a) all patents and patent applications, and any and all patents that
are or may be granted therefrom, whether in the United States or any other
country or jurisdiction, including, without limitation, any continuations,
continuations-in-part, divisions, reissuances, reexaminations, renewals,
revisions and extensions thereof;
(b) all trademarks, service marks, trade names, domain names, logos,
and trade dress, together with all translations, adaptations, derivations and
combinations thereof, including all registrations and applications for
registration in the United States or any other country or jurisdiction
pertaining to the same, and any common law rights therein and goodwill
associated therewith;
(c) all copyrighted or copyrightable works, including all copyright
registrations or applications therefor (along with any rights of renewal or
extension) in the United States or any other country or jurisdiction;
(d) all computer software (including, without limitation, source and
object code), including any proprietary rights therein and all related
documentation and other materials related to the computer software (in whatever
medium or form);
(e) all rights of paternity, integrity, disclosure and withdrawal and
any other rights that may be know as or referred to as "moral rights";
(f) all database technologies, systems, structures and architectures;
(g) all trade secrets, know-how, technology and other confidential
business information relating to the Business (including, without limitation,
product specifications, data, formulae, algorithms, compositions, processes,
designs, sketches, photographs, graphs, drawings, samples, inventions and ideas,
past, current and planned research and development, customer lists, customer
files, current and anticipated customer requirements, price lists, market
studies, marketing materials and business methods and plans), however embodied
or documented;
(h) all information concerning the Business and the affairs of
Assignor related to the Business (including, without limitation, financial
projections and budgets, historical and projected sales, capital spending
budgets and plans, personnel training and policy documentation), however
documented;
(i) all notes, analysis, compilations, studies, summaries, and other
material prepared by or for Assignor containing or based, in whole or in part,
on any information included in any of the foregoing subsections (a) through (a),
however documented;
(j) all developments with respect to industrial and intellectual
property rights relating to the Business (the "Developments"), made, conceived,
reduced to practice or developed by Assignor, either alone or jointly with
others, during the term of this Agreement, including developments with respect
to the foregoing subsections (a) through (b);
(k) all similar or equivalent rights to any of the subject matter of
the foregoing subsections (a) through (c), or to any other forms of intellectual
property, anywhere in the world; and
(l) all rights and privileges pertaining to the subject matter of
subsections (a) through (d), including, without limitation, all causes of
action, claims, demands presently or hereafter accruing with respect to the
same, including the right to xxx or bring other actions for past, present and
future infringement thereof anywhere in the world.
The Company does not assume and is not obligated to pay or discharge any
liabilities of any kind, whether known or unknown, contingent or otherwise,
accrued or incurred by Assignor, including, without limitation, liabilities
relating to the Rights and the Business as operated by Assignor prior to the
Effective Date, and all such liabilities shall remain the sole and absolute
responsibility of Assignor through, from and after the Effective Date.
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2. Warranties. Assignor represents and warrants that (a) Assignor has
all rights necessary to make the assignment herein; (b) the Rights are free of
any liens or encumbrances; (c) none of the Rights have been licensed to third
parties; (d) this assignment does not conflict with any other agreement or other
instrument to which Assignor is bound; (e) to the best of Assignor's knowledge,
the Rights do not infringe any patent, trademark, or copyright or misappropriate
a trade secret; (f) this Agreement constitutes the valid and legally binding
obligation of Assignor, enforceable in accordance with its terms and conditions
and that any entity included within the definition of Assignor is duly
organized, validly existing and in good standing and that Xx. Xxxx has full
signatory power and authority to execute this Agreement on behalf of any such
entities; (g) there is no basis for any present or future action, suit,
proceeding, hearing, investigation, charge, complaint, claim or demand relating
to the Rights giving rise to any liability to the Company; (h) to the knowledge
of Assignor, Assignor has complied with all applicable laws of federal, state,
local and foreign governments; and (i) no intellectual property rights related
to or similar to the Rights have been sold, licensed or otherwise transferred or
conveyed by Assignor in the 180 days prior to the Effective Date. The
representations and warranties contained in this Section 2 shall survive the
Effective Date.
3. Protection. Assignor further assigns all rights, and empowers the
Company, its successors, assigns and nominees, to make applications for patent,
trademark, copyright or other intellectual property registration or protection
anywhere in the world, to claim and receive the benefit of any applicable rights
of priority in connection with such applications, to prosecute such applications
to issue, and to have any and all registrations issued in the name of the
Company.
4. Further Assurances. Assignor further agrees that Assignor will: (a)
cooperate with the Company in the filing and prosecution of any and all patent,
trademark, copyright or other intellectual property registrations or
applications; (b) execute, verify, acknowledge and deliver all such further
papers, including applications and instruments of transfer; and (c) perform such
other acts as the Company lawfully may request, to facilitate the Company's
right to obtain, protect, maintain, defend or enforce any of the Rights granted
hereunder. In the event that the Company is unable for any reason whatsoever to
secure Assignor's signature to any document when so required to effectuate fully
this Assignment, Assignor hereby irrevocably designates and appoints the Company
and the Company's duly authorized officers and agents, as Assignor's agents and
attorneys-in-fact to act for and on his behalf and instead of him, to execute
and file any such document and to do all other lawfully permitted acts to
further the purposes of the foregoing, with the same legal force and effect as
if executed by Assignor.
5. Disclosure of Developments to Company. Xx. Xxxx will promptly
disclose in writing to the Chief Technical Officer of the Company, or to any
persons designated by the Company, all Developments in order to allow the
Company to exercise its rights under this Agreement.
6. License. If any Rights assigned hereunder are based on, or
incorporate, or are improvements or derivatives of, or cannot be reasonably
made, used, reproduced and distributed without using or violating technology or
rights owned or licensed by Assignor and not assigned hereunder, Assignor hereby
grants the Company a perpetual, worldwide, royalty-free, non-exclusive,
sublicensable right and license to exploit and exercise all such technology and
rights
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in support of the Company's exercise or exploitation of any assigned Rights
(including any modifications, improvements and derivatives thereof).
7. Consulting Agreement. For the consideration set forth herein, Xx.
Xxxx further agrees to consult for the Company pursuant to the terms set forth
in the attached Schedule B. Xx. Xxxx'x performance of consulting services under
this Agreement shall be conducted with due diligence and in full compliance with
the highest professional standards of practice in the industry. Xx. Xxxx shall
comply with all applicable laws and Company safety rules in the course of
performing the consulting services. If Xx. Xxxx'x work requires a license, Xx.
Xxxx has obtained that license and the license is in full force and effect. Xx.
Xxxx understands that as a part of the consideration for his retention as a
consultant hereunder, he has not brought and will not bring with him to the
Company or use in the performance of his responsibilities at the Company any
equipment, supplies, facilities or trade secret of any current or former
employer or business associate which are not generally available to the public,
unless he has obtained written authorization for the possession and use. Xx.
Xxxx also understands that, in consideration of his retention as a consultant of
the Company, he is not to breach any obligation of confidentiality that he has
to others, and he agrees that he shall fulfill such obligations during his
retention as a consultant with the Company. Xx. Xxxx further agrees that, during
the term of this Agreement, he will not provide consulting services or similar
services which are the same as or similar to his duties hereunder to any third
party and will not provide any consulting or similar services to a competitor of
the Company.
8. Consideration. As consideration of Assignor's assignment of the
Rights to the Company, the Company shall issue and deliver to Xx. Xxxx on the
date hereof 75,000 shares of Common Stock of the Company. As consideration for
Xx. Xxxx'x performance of consulting services pursuant to Section 7 above, the
Company shall issue and deliver to Xx. Xxxx on the date hereof 25,000 shares of
Common Stock of the Company to be earned ratably over the period over which such
consulting services are to be provided. (The aggregate 100,000 shares of Common
Stock to be issued to Xx. Xxxx hereunder are referred to herein as the
"Shares.") Assignor and the Company agree to allocate the consideration as set
forth above for all purposes (including financial accounting and tax purposes).
The parties hereto covenant and agree with each other that this allocation has
been arrived at by arms-length negotiation and that none of them will take a
position on any income tax return, before any governmental agency charged with
the collection of income tax in any judicial proceeding that is in any manner
inconsistent with this Section 8 without the written consent of the other party
to this Agreement.
9. Company Property. All documents, data, records, apparatus, equipment,
chemicals, molecules, organisms and other physical property, whether or not
pertaining to the Company's proprietary information, furnished to Xx. Xxxx by
the Company or produced by Xx. Xxxx or others in connection with Xx. Xxxx'x
retention as a consultant shall be and remain the sole property of the Company
and shall be returned promptly to the Company as and when requested by the
Company. Should the Company not so request, Xx. Xxxx shall return and deliver
all such property upon termination of Xx. Xxxx'x retention as a consultant by
Xx. Xxxx or by the Company for any reason and Xx. Xxxx will not take any such
property or any reproduction of such property upon such termination.
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10. Disclosure. Xx. Xxxx will promptly disclose to the Company, or any
persons designated by him, all improvements, inventions, formulae, processes,
techniques, know-how and data, whether or not patentable, made or conceived or
reduced to practice or learned by Xx. Xxxx, either alone or jointly with others,
during the period of Xx. Xxxx'x retention as a consultant which (a) arise from
services provided by Xx. Xxxx under this Agreement and related to or useful in
the business of the Company, or (b) result from tasks assigned Xx. Xxxx by the
Company, or (c) funded by the Company, or (d) result from use of premises owned,
leased or contracted for by the Company (all said improvements, inventions,
formulae, processes, techniques, know-how and data shall be collectively
hereinafter called "Inventions"). Such disclosure shall continue for one year
after termination of this Agreement with respect to anything that would be an
Invention if made, conceived, reduced to practice or learned during the term
hereof.
11. Inventions. Xx. Xxxx agrees that all Inventions shall be the sole
property of the Company and its assigns, and the Company and its assigns shall
be the sole owner of all patents and other rights in connection therewith. Xx.
Xxxx hereby assigns to the Company any rights Xx. Xxxx may have or acquire in
all Inventions. Xx. Xxxx further agrees as to all Inventions to assist the
Company at any time, and not just during the term of this Agreement, in any and
all countries, which assistance shall include the execution of documents and any
assignments to the Company or persons designated by it. In the event that the
Company is unable for any reason whatsoever to secure Xx. Xxxx'x signature to
any lawful and necessary document required to apply for or execute any patent
application with respect to an invention(s) (including reissues, renewals,
extensions, continuations, divisions or continuations in part thereof), Xx. Xxxx
hereby irrevocably designates and appoints the Company and its duly authorized
officers and agents, as Xx. Xxxx'x agents and attorneys-in-fact to act for and
in behalf and instead of Xx. Xxxx, to execute and file any such application and
to do all other lawful acts to further the prosecution and issuance of patents
thereon with the same legal force and effect as if executed by Xx. Xxxx.
12. Acknowledgement. As a matter of record, Xx. Xxxx acknowledges and
agrees that all inventions or improvements relevant to the subject matter of Xx.
Xxxx'x retention as a consultant by the Company which have been made or
conceived or first reduced to practice by Xx. Xxxx alone or jointly with others
prior to Xx. Xxxx'x engagement by the Company are included within the Rights.
13. Indemnification. Xx. Xxxx will defend, indemnify and hold harmless
the Company and its officers, directors, agents, employees and affiliates from
and against any and all claims, demands, actions, causes of action, losses,
costs, damages, liabilities and expenses, including, without limitation, legal
fees and expenses arising out of or relating to (a) any misrepresentation or
breach of or default in connection with any of the representations, warranties,
covenants given or made by Xx. Xxxx in this Agreement or in any schedule hereto
or in any certificate, document or instrument delivered by or on behalf of
Assignor pursuant hereto; (b) any of the non-assumed liabilities set forth in
Section 1 above; (c) infringement of any third party patent, copyright,
trademark or misappropriation of any trade secret, insofar as such liability is
based on a claim that the infringement or misappropriation is attributable to
the Company's application, without substantial modification, of the Rights
assigned under this Agreement; or (d) any tax liability arising out of the
consideration payable pursuant to the terms of this Agreement. The Company shall
give reasonably prompt notice of a claim for indemnity to Xx. Xxxx, and shall
give Xx. Xxxx such information with respect thereto as Xx. Xxxx may
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reasonably request. The giving of such a claim notice shall not be a condition
precedent to indemnification hereunder; provided, however, the failure to give
reasonably prompt notice shall reduce the Company's recovery from Xx. Xxxx only
by the amount equal to the damages, costs and expenses, if any, caused by such
delay. Upon receipt of such notice, Xx. Xxxx may, at his own expense,
participate in, and solely upon giving notice to the Company of Xx. Xxxx'x
written agreement that the Company is entitled to indemnification pursuant to
this Section 13 for losses or damages arising out of any third party claim,
suit, action or proceeding, at any time during the course of such claim, suit,
action or proceeding, assume the defense thereof; provided, however, that (a)
Xx. Xxxx'x counsel is reasonably satisfactory to the Company; (b) Xx. Xxxx shall
consult with the Company upon the Company's reasonable request for such
consultation from time to time with respect to such claim, suit, action or
proceeding; and (c) the Company shall not be required to permit Xx. Xxxx to
assume the defense of any third party claim which if not first paid, discharged
or otherwise complied with would result in an imminent, material interruption or
cessation of the conduct of the business of the Company or any material part
thereof. If Xx. Xxxx assumes such defense, the Company shall have the right (but
not the duty) to participate in the defense thereof and to employ counsel, at
its own expense, separate from the counsel employed by Xx. Xxxx. Whether or not
Xx. Xxxx chooses to defend or prosecute any such claim, suit, action or
proceeding, all of the parties hereto shall cooperate in the defense or
prosecution thereof. In the event that Xx. Xxxx does not elect to assume the
defense of any claim, suit, action or proceeding, then any failure of the
Company to defend or participate in the defense of such claim, suit, action or
proceeding or to cause the same to be done, shall not relieve Xx. Xxxx of his
obligations hereunder. The parties hereby acknowledge and agree that the
indemnity obligations set forth above shall not be the exclusive remedy of the
Company with respect to the transactions contemplated hereby.
14. Termination and Release. The Company and Xx. Xxxx hereby mutually
acknowledge and agree that any prior consulting agreements or arrangements
between Xx. Xxxx and the Company are hereby terminated in their entirety
including, without limitation, that certain Consulting Agreement dated September
3, 1999 by and between Xx. Xxxx and the Company. Xx. Xxxx hereby releases and
forever discharges the Company from any obligations, claims, fees or liabilities
arising out of such terminated agreements.
15. Non-Solicitation. Xx. Xxxx agrees that during the term of this
Agreement and for a period of one year thereafter, he shall not, directly or
indirectly, for his own account or for the benefit of any other person:
(a) solicit or induce, or in any manner attempt to solicit or induce,
any customer or prospective customer of the Company (i) to cease being or not to
become a customer of the Company or (ii) to divert any business of such customer
from the Company; or
(b) otherwise interfere with, disrupt, or attempt to interfere with
or disrupt the relationship, contractual or otherwise, between the Company and
any of its respective customers, clients, investors, suppliers, consultants,
independent contractor sales associates, or employees.
(c) solicit or induce, or in any manner attempt to solicit or induce,
any employee of the Company (i) to cease being an employee of the Company or
(ii) to recruit any
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employee of the company to accept employment or a consultant or other
financially beneficial arrangement with any other entity.
16. Non-Competition. Assignor agrees that during the five year period
following the Effective Date, Assignor will not engage or invest in, own,
manage, finance, operate, control or participate in the ownership, management,
operation, financing or control of, accept employment or be retained by or
associated with any entity or party in or doing business in the United States
that engages, directly or indirectly, in any business which is the same as,
similar to or competitive with the Company or its subsidiaries or affiliates.
The parties agree that for purposes of this Agreement, the business of the
Company and its subsidiaries in affiliates is defined as the development, the
manufacture, sale, distribution and export of the medical devices and related
disposable supplies in the urology and oncology markets and the development,
manufacture, sale, distribution and export of cryosurgical technology in other
surgical markets and the methods, techniques and apparatus related to surgical
procedures in all cryosurgical markets (the "Business").
17. Reasonableness of Restrictions. Xx. Xxxx agrees that the
restrictions contained in Sections 15 and 16 are reasonable in scope, duration,
and geographic territory, and are designed to provide the Company with limited,
legitimate, and reasonable protection against subsequent diminution of the value
of the Company's business and goodwill attributable to any actions by Assignor
contrary to such restrictions. Xx. Xxxx represents to the Company that the
enforcement of the restrictions contained in Sections 15 and 16 would not be
unduly burdensome to Assignor and that he is able to pursue his business
interests and earn a living by means not prohibited by Sections 15 or 16.
18. Nondisparagement. Xx. Xxxx shall refrain from making disparaging and
derogatory comments or references about the Company, including with regard to
the business, practices, competence or services of the Company.
19. Competing Products. During the term of this Agreement, Xx. Xxxx
shall refrain from the use of medical devices which directly compete with the
Company's products.
20. Agreement Not to Use or Disclose Confidential Information. In
consideration of issuance of the Shares, Xx. Xxxx covenants as follows: (a) Xx.
Xxxx will hold in confidence all Confidential Information (as defined below);
(b) will not disclose it to any person except with the specific prior written
consent of the Company and Xx. Xxxx will not use the Confidential Information in
any way, including, without limitation, to frustrate, hinder or delay any
business opportunity of the Company or to obtain unauthorized economic benefit
from such Confidential Information; and (c) any trade secrets of the Company
will be entitled to all of the protections and benefits under California Civil
Code Section 3426 et seq and any other applicable law. If any information that
the Company deems to be a trade secret is found by a court of competent
jurisdiction not to be a trade secret for purposes of this Agreement, such
information will, nevertheless, be considered Confidential Information for
purposes of this Agreement. Assignor hereby waives any requirement that the
Company submit proof of the economic value of the any trade secret or post any
bond or other security. None of the foregoing obligations or restrictions
applies to any part of the Confidential Information that Xx. Xxxx demonstrates
was or became generally available to the public other than as a result of
disclosure or action by Xx. Xxxx. For
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purposes of this Section 20, "Confidential Information" will mean any and all
(a) trade secrets concerning the business and affairs of the Company, product
specifications, data, know-how, formulae, compositions, processes, designs,
sketches, photographs, graphs, drawings, samples, inventions and ideas, past,
current, and planned research and development, current and planned manufacturing
or distribution methods and processes, customer lists, current and anticipated
customer requirements, price lists, market studies, business plans, computer
software and programs (including object code and source code), computer software
and database technologies, systems, structures and architectures (and related
formulae, compositions, processes, improvements, devices, know-how, inventions,
discoveries, concepts, ideas, designs, methods and information), and any other
information, however documented, that is a trade secret within the meaning of
California Civil Code Section 3462, et seq; (b) any information concerning the
business and affairs of the Company, which includes historical financial
statements, financial projections and budgets, historical and projected sales,
capital spending budgets and plans, the names and backgrounds of key personnel,
personnel training techniques and materials, however documented; and (c) notes,
analysis, compilations, studies, summaries and other materials prepared by or
for the Company containing or based, in whole or in part, on any information
included in the foregoing.
21. Injunctive Relief an Additional Remedy. Xx. Xxxx acknowledges that
the injury that would be suffered by the Company as a result of the breach of
the provisions of this Agreement (including any provisions of Sections 15, 16,
18 and 20) would be irreparable and an award of monetary damages to the Company
for such breach would be an inadequate remedy. Consequently, the Company will
have the right, in addition to any other rights it may have, to obtain
injunctive relief to restrain any breach or threatened breach or otherwise to
specifically enforce any provision of this Agreement, and the Company will not
be obligated to post bond or other security in seeking such relief.
22. Relationship of the Parties. Nothing herein contained shall be
deemed to create an agency, joint venture, partnership or franchise relationship
between the parties hereto. Xx. Xxxx acknowledges that he is an independent
contractor, is not an agent or employee of the Company, is not entitled to any
Company employment rights or benefits and is not authorized to act on behalf of
the Company. Xx. Xxxx shall be solely responsible for any and all tax
obligations of Xx. Xxxx, including but not limited to, all city, state and
federal income taxes, social security tax and other self employment taxes
incurred by Xx. Xxxx, and the Company shall not be responsible for withholding
any such taxes on behalf of Xx. Xxxx. In addition, Xx. Xxxx shall not be
entitled to any employee benefits, including without limitation, retirement,
profit sharing, or medical insurance. The Company shall not dictate the work
hours of Xx. Xxxx during the term of this Agreement. Subject to Section 16 of
this Agreement, Xx. Xxxx shall perform the consulting services on a
non-exclusive basis and shall be free to accept other engagements during the
term of this Agreement. The parties hereby acknowledge and agree that the
Company shall have no right to control the manner, means, or method by which Xx.
Xxxx performs the consulting services. Rather, the Company shall be entitled
only to direct Xx. Xxxx with respect to the elements of the consulting services
and the results to be derived by the Company, to inform Xx. Xxxx as to where and
by when the consulting services shall be performed, and to review and assess the
performance of the consulting services by Xx. Xxxx for the limited purposes of
assuring that the consulting services have been performed and confirming that
such results were satisfactory. The Company shall be entitled to exercise broad
general power of
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supervision and control over the results of work performed by Xx. Xxxx'x
personnel, if any, to ensure satisfactory performance, including but not limited
to, the right to inspect, the right to stop work, the right to make suggestions
or recommendations as to the details of the work, and the right to propose
modifications to the work.
23. Investment Representations. Xx. Xxxx is an "accredited investor"
within the meaning of Rule 501 under the Securities Act of 1933, as amended
(together with all rules and regulations promulgated thereunder, the "Securities
Act"). Xx. Xxxx 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 Xx. Xxxx'x investment in
the Company and Xx. Xxxx is able financially to bear the risks thereof. Xx. Xxxx
has had an opportunity to discuss the terms and conditions of the offering of
the Shares and the Company's business, properties, management and financial
affairs with the Company's management, and Xx. Xxxx believes he has received all
the information he considers necessary or appropriate for deciding whether to
purchase the Shares. Xx. Xxxx has been furnished with the Company's S-3
Registration Statement filed with the Securities and Exchange Commission on
September 20, 2001, the Company's Form 10-K for the year ended December 31, 2000
filed with the Commission, together with all subsequently filed Forms 10-Q, and
other publicly available filings made with the Commission. Xx. Xxxx has
carefully examined all such filings, including, without limitation, the risk
factors contained therein. Xx. Xxxx understands that no United States federal or
state agency or any other government or governmental agency has passed upon or
made any recommendation or endorsement of the Common Stock issuable pursuant to
the terms of this Agreement. Xx. Xxxx has not received any information relating
to the securities of the Company, and it is not purchasing the Common Stock
issuable hereunder as a result of, any form of general solicitation or general
advertising, including, without limitation, any advertisement, article, notice
or other communication published in any newspaper or magazine or similar media
or broadcast over television or radio pursuant to any seminar or meeting whose
attendees were invited by any general solicitation or general advertising. Xx.
Xxxx has had an opportunity to consult with an attorney in connection with his
investment in the Company. Neither Xx. Xxxx nor any affiliate of Xx. Xxxx will
enter into any put option, short position or other similar position with respect
to the Common Stock issuable hereunder. Xx. Xxxx represents that he is resident
of the State of Florida. This Agreement is made with Xx. Xxxx in reliance on Xx.
Xxxx'x representation to the Company, which by Xx. Xxxx'x execution of this
Agreement Xx. Xxxx hereby confirms, that the Shares are being acquired for Xx.
Xxxx'x own account, not as a nominee or agent, for the purpose of investment and
not with a view to the resale or distribution of any part thereof, and that Xx.
Xxxx has no present intention of selling, granting any participation in or
otherwise distributing the Shares. By executing this Agreement, Xx. Xxxx further
represents that he does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to any of the Shares. Xx. Xxxx
understands that (a) the Shares have not been registered under the Securities
Act by reason of their issuance in a transaction exempt from the registration
requirements of the Securities Act pursuant to Section 4(2) thereof or Rule 505
or 506 promulgated thereunder, (b) the Shares must be held indefinitely unless a
subsequent disposition thereof is registered under the Securities Act or is
exempt from such registration, (c) the Shares will bear a legend to such effect
and (d) the Company will make a notation on its transfer books to such effect.
In this regard, Xx. Xxxx represents that he is familiar with Securities Act Rule
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144, as presently in effect, and understands the resale limitations imposed
thereby and by the Securities Act.
24. Resales of Shares.
(a) Xx. Xxxx hereby covenants and agrees not to make any disposition
of all or any portion of the Shares unless and until he has satisfied the rules,
regulations and other requirements of the Securities Act.
(b) Xx. Xxxx shall notify the Company in advance of any proposed
disposition of any unregistered Shares and shall furnish the Company with a
statement of the circumstances surrounding the proposed disposition, and if
requested by the Company, Xx. Xxxx shall furnish the Company with an opinion of
counsel, reasonably satisfactory to the Company, that such disposition will not
require registration of the Shares under the Securities Act.
25. "Market Stand-Off" Agreement. Xx. Xxxx hereby covenants and agrees
not to sell or otherwise transfer or dispose of any Common Stock (or other
securities) of the Company held by him during the 180 day period following the
effective date of a registration statement of the Company filed under the
Securities Act. The obligations described in this Section 25 shall not apply to
a registration relating solely to employee benefit plans on Form S-l or Form S-8
or similar forms which may be promulgated in the future, or a registration
relating solely to a Commission Rule 145 transaction on Form S-4 or similar
forms which may be promulgated in the future. The Company may impose
stop-transfer instructions with respect to the shares (or securities) subject to
the foregoing restriction until the end of said 180 day period.
The forgoing covenant shall be enforceable at the election of the
Company. In the event that the Company elects to enforce the covenant described
in this Section 26 on or prior to April 15, 2003, Xx. Xxxx shall be entitled to
receive, upon written request, a principal loan amount from the Company equal to
(a) the aggregate federal tax liability, if any, attributable to the issuance of
the Shares under this Agreement due and payable by Xx. Xxxx on April 15, 2003,
less (b) any and all proceeds received, directly or indirectly, by Xx. Xxxx in
connection with the sale, loan, pledge, offer or other transfer or disposition
of the Shares (the "Principal Loan"). Interest on the Principal Loan shall
compound annually at a rate equal to the adjusted applicable federal rate
determined by the Internal Revenue Service for the month in which the Principal
Loan is provided to Xx. Xxxx. The Principal Loan shall be secured by the Shares
and other collateral upon the terms set forth in a stock pledge agreement
reasonably acceptable to the Company. The remaining terms and provisions of the
Principal Loan, including, without limitation, the maturity date, prepayment and
amendment provisions, shall be set forth in a note secured by stock pledge
agreement reasonably acceptable to the Company. In the event that the Company
elects not to enforce the covenant described in this Section 26 prior to April
15, 2003 or if the Company elects to enforce this covenant after April 15, 2003,
then in each case, the Company shall have no liability or other obligation to
make any payment or lend any funds to Xx. Xxxx.
26. Legends. It is understood that the certificates evidencing the
Shares may bear the following legends and any other legends required by
applicable laws:
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"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT
OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144
OF SUCH ACT."
27. General.
(a) Term. This Agreement will commence on the Effective Date, and
continue in effect until February 6, 2017.
(b) Survival. All obligations under Sections 3, 4, 6, 9, 10, 11, 13,
15, 18, 20, 21, 24, 25 and 27 shall continue in effect after the termination of
this Agreement.
(c) Notices. All notices required under this Agreement shall be in
writing and shall be by personal delivery, facsimile transmission, international
courier with tracking capabilities or by certified or registered mail, return
receipt requested, and shall be deemed given upon receipt of delivery. Notices
hereunder shall be sent to the addresses set forth on the signature page to this
Agreement or such other address as either party may specify in writing.
(d) Binding Nature; Assignment. This Agreement shall be binding upon
the parties and their respective heirs, successors, assigns and personal
representatives; provided, however, that Assignor may not assign or otherwise
transfer his rights and obligations under this Agreement without the prior
written consent of the Company.
(e) Public Announcement. Xx. Xxxx shall not issue any press release
or make any public announcement relating to the subject matter of this Agreement
without the prior written approval of the Company.
(f) Waiver. The failure of a party to require performance by another
party of any provision hereof shall not affect the full right to require such
performance at any time thereafter; nor shall the waiver by either party of a
breach of any provision hereof be taken or held to be a waiver of the provision
itself.
(g) Severability. Whenever possible each provision and term of this
Agreement will be interpreted in a manner to be effective and valid. If any
provision or term of this Agreement is held to be prohibitive by law or invalid,
then such provision or term will be ineffective only to the extent of such
prohibition or invalidity, without invalidating or affecting in any manner
whatsoever the remainder of such provision or term or the remaining provisions
of terms of this Agreement. If any of the covenants set forth in this Agreement
are held to be unreasonable, arbitrary or against public policy, such covenants
will be considered divisible with respect to scope, time and geographic area and
in such lesser scope, time and geographic area will be effective, binding and
enforceable against Assignor.
(h) Controlling Law; Jurisdiction. This Agreement shall be
interpreted and controlled by and construed and enforced according to the laws
of the State of Florida without
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regard to conflicts of laws provisions thereof.
(i) Entire Agreement; Modification. This Agreement (together with all
Schedules hereto) constitutes the entire agreement between the parties
concerning the subject matter hereof. This Agreement replaces and fully
supersedes any prior verbal or written understandings, communications, or
representations between the parties. This Agreement shall not be modified except
by a subsequently dated written amendment signed by a duly authorized
representative of each party.
(j) Counterparts. This Agreement may be executed in any number of
counterparts, any of which need not contain the signatures of more than one
party, but all such counterparts taken together shall constitute one and the
same Agreement, and signatures may be transmitted by facsimile to the parties,
with the original signatures to follow by overnight courier.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
executed as of the date above first written.
ASSIGNOR:
/s/ Xxxx X. Xxxx, M.D.
---------------------------------------
Xxxx X. Xxxx, M.D.
000X Xxxx Xxx Xxxxxx
Xxxxxxxxx, Xxxxxxx 00000
THE COMPANY:
ENDOCARE, INC.
By: /s/ Xxxx Xxxxx
-----------------------------------
Name: Xxxx Xxxxx
Title: CEO
Endocare, Inc.
7 Studebaker
Xxxxxx, Xxxxxxxxxx 00000
COUNTERPART SIGNATURE PAGE
TO ASSET PURCHASE AGREEMENT
STATE OF FLORIDA )
) SS.
COUNTY OF OSCEOLA )
I, a notary public, in and for the county and state aforesaid, do hereby
certify that Xx. Xxxx Xxxx, known to me to be the physician of PH appeared
before me this day in person and acknowledged that he signed the above and
foregoing instrument as his free and voluntary act.
IN WITNESS WHEREOF, I have hereunto set my hand and notarial seal this
day of Feb. 6, 2002.
/s/ Xxxxx X. Xxxxxx
---------------------------------------
Notary Public
Xxxxx X. Xxxxxx
Notary Public, State of Florida
My comm. exp. Nov. 29, 2004
Comm. No. CC 984648
My commission expires:__________________
SCHEDULE A
TECHNOLOGY
This schedule has been omitted in accordance with Item 601(b)(2) of Regulation
S-K. A copy of this schedule will be furnished supplementally to the Securities
and Exchange Commission upon request.
A-1
SCHEDULE B
CONSULTING SERVICES
This schedule has been omitted in accordance with Item 601(b)(2) of Regulation
S-K. A copy of this schedule will be furnished supplementally to the Securities
and Exchange Commission upon request.
B-1
