STOCK PURCHASE AGREEMENT By and Between MEDICAL MEDIA TELEVISION, INC. and VICIS CAPITAL MASTER FUND May 31, 2007
By
and Between
and
VICIS
CAPITAL MASTER FUND
May
31, 2007
This
STOCK PURCHASE AGREEMENT (the “Agreement”), dated this 31st day of May, 2007, is
made by and between MEDICAL MEDIA TELEVISION, INC., a Florida corporation (the
“Company”), and VICIS CAPITAL MASTER FUND, a trust formed under the laws of the
Cayman Islands (the “Purchaser”).
RECITALS
WHEREAS,
pursuant to the terms and conditions of this Agreement, the Company wishes
to
issue and sell to the Purchaser, and the Purchaser wishes to acquire from the
Company 20,000,000 shares (the “Acquired Shares”) of the Company’s common stock,
par value $.0005
per
share (the “Common Stock”).
WHEREAS,
the Purchaser is also the holder of (a) certain warrants issued by the Company
to acquire Common Stock of the Company (the “Warrants”); (b) certain shares of
preferred stock of the Company convertible into Common Stock of the Company
(the
“Preferred Shares”); and (c) certain promissory notes and debentures convertible
into Common Stock of the Company (the “Notes”).
WHEREAS,
the Warrants, the Preferred Shares, and the Notes are subject to certain
anti-dilution provisions (the “Ratchet Provisions”) that require the Company to
reduce the exercise price of the Warrants and the conversion price of the
Preferred Shares and Notes in the event that the Company issues its Common
Stock
in certain transactions for a price less than the exercise price of the Warrants
or the conversion price of the Preferred Shares or Notes, as the case may
be;
WHEREAS,
although the Company’s issuance and sale of the Acquired Shares to the Purchaser
pursuant to this Agreement triggers the Ratchet Provision described in the
preceding paragraph, the Purchaser has agreed to waive the Ratchet Provisions
contained in the Preferred Shares and Notes solely in connection with this
transaction.
NOW,
THEREFORE, the Company and the Purchaser hereby agree as follows:
ARTICLE
I
PURCHASE
AND SALE OF THE ACQUIRED
SHARES
1.1 Purchase
and Sale of the Acquired Shares.
Subject
to the terms and conditions hereof and in reliance on the representations and
warranties contained herein, or made pursuant hereto, the Company will issue
and
sell to the Purchaser, and the Purchaser will purchase from the Company at
the
closing of the transactions contemplated hereby (the “Closing”), the Acquired
Shares for $200,000 in cash (the “Purchase Price”).
1.2 Closing.
The
Closing shall be deemed to occur at the offices of ▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP, ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ at 5:00 p.m. CDT on May 31, 2007
or
at such other place, date or time as mutually agreeable to the parties (the
“Closing Date).
1.3 Closing
Matters.
On the
Closing Date, subject to the terms and conditions hereof, the Company will
deliver to the Purchaser a certificate, registered in the name of the Purchaser,
representing the Acquired Shares.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
The
Company hereby represents and warrants to the Purchaser as of the date of this
Agreement as follows:
2.1 Organization
and Qualification.
The
Company is a corporation duly organized and validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated, and
has
all requisite corporate power and authority to carry on its business as now
conducted. The Company is duly qualified as a foreign corporation to do business
and is in good standing in every jurisdiction in which its ownership of property
or the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in
good standing would not have a Material Adverse Effect. As used in this
Agreement, “Material Adverse Effect” means any material adverse effect on the
business, properties, assets, operations, results of operations, condition
(financial or otherwise) or prospects of the Company or its Subsidiaries (as
defined below) or on the transactions contemplated hereby or by the agreements
and instruments to be entered into in connection herewith, or on the authority
or ability of the Company to perform its obligations under the Transaction
Documents (as hereinafter defined).
2.2 Subsidiaries.
The
Company has no subsidiaries other than PetCARE Television Network, Inc., a
Florida corporation (“PetCARE”), African American Medical Network, Inc., a
Florida corporation (“African American Medical”), and KidCARE Medical Television
Network, Inc., a Florida corporation (“KidCARE”) (each a “Subsidiary” and
collectively, the “Subsidiaries”). Except as set forth on Schedule
2.2,
the
Company owns, directly or indirectly, all of the capital stock of its
Subsidiaries, free and clear of any and all Liens, and all the issued and
outstanding shares of capital stock of each Subsidiary are validly issued and
are fully paid, non-assessable and free of preemptive and similar rights. Each
Subsidiary is a corporation duly organized and validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated, and
has
all requisite corporate power and authority to carry on its business as now
conducted. Each Subsidiary is duly qualified as a foreign corporation to do
business and is in good standing in every jurisdiction in which its ownership
of
property or the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in
good standing would not have a Material Adverse Effect.
2.3 No
Violation.
Neither
the Company nor any of its Subsidiaries is in violation of: (a) any of the
provisions of its certificate or articles of incorporation, bylaws or other
organizational or charter documents; or (b) any judgment, decree or order
or any statute, ordinance, rule or regulation applicable to the Company or
any
of its Subsidiaries, except for possible violations which would not,
individually or in the aggregate, have a Material Adverse Effect.
2
2.4 Capitalization.
(a) Immediately
before the Closing, the authorized capital stock of the Company consists of:
(i)
100,000,000 shares of Common Stock, of which (A) 56,847,389 shares are issued
and outstanding, (B) no shares of Common Stock held in treasury, (C)
35,114,082
shares
of Common Stock reserved for issuance upon the exercise of options, warrants
and
other securities convertible into Common Stock; and (ii) 25,000,000 shares
of
Preferred Stock, of which
1,682,044 shares have been designated as “Series A Preferred Stock,” 2,612,329
shares have been designated as “Series B Preferred Stock,” and 400,000 shares
have been designated as “Series C Preferred Stock,” of which (X) 1,682,044
shares of the Company’s Series A Preferred Stock are issued and outstanding, (Y)
2,612,329 shares of the Company’s Series B Preferred Stock are issued and
outstanding, and (Z) 32,242 shares of the Company’s Series C Preferred Stock are
issued and outstanding.
All of such issued and outstanding shares have been, or upon issuance will
be, validly issued, are fully paid and nonassessable.
(b) Except
as
disclosed in the Company’s reports, financial statements, schedules, forms,
statements and other documents required to be filed by it with the Securities
and Exchange Commission (the “SEC”) pursuant to the reporting requirements of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or
otherwise on Schedule 2.4(b),
prior
to the date hereof (the “SEC Documents”):
(i) no
holder
of shares of the Company’s capital stock has any preemptive rights or any other
similar rights or has been granted or holds any liens or encumbrances suffered
or permitted by the Company;
(ii) there
are
no outstanding options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company or any of its Subsidiaries, or contracts, commitments,
understandings or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional shares of capital stock of the
Company or any of its Subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to,
or
securities or rights convertible into, or exercisable or exchangeable for,
any
shares of capital stock of the Company or any of its Subsidiaries;
(iii) there
are
no outstanding debt securities, notes, credit agreements, credit facilities
or
other agreements, documents or instruments evidencing Indebtedness (as defined
in Section 2.13 hereof) of the Company or any of its Subsidiaries or by
which the Company or any of its Subsidiaries is or may become
bound;
(iv) there
are
no financing statements securing obligations in any material amounts, either
singly or in the aggregate, filed in connection with the Company any of its
Subsidiaries;
(v) there
are
no agreements or arrangements under which the Company or any of its Subsidiaries
is obligated to register the sale of any of their securities under the
Securities Act of 1933, as amended, (the “Securities Act”);
3
(vi) there
are
no outstanding securities or instruments of the Company or any of its
Subsidiaries that contain any redemption or similar provisions, and there are
no
contracts, commitments, understandings or arrangements by which the Company
or
any of its Subsidiaries is or may become bound to redeem a security of the
Company or any of its Subsidiaries; and
(vii) the
Company does not have any stock appreciation rights or “phantom stock” plans or
agreements or any similar plan or agreement.
(c) Except
for the Warrants, the Preferred Stock and the Notes, or as set forth in
Schedule
2.4(c),
there
are no securities or instruments containing antidilution provisions, provisions
similar to the Ratchet Provisions, or other similar provisions that will be
triggered by the issuance of the Acquired Shares.
2.5 Issuance
of the Acquired Shares.
The
Acquired Shares to be issued hereunder are duly authorized and, upon payment
and
issuance in accordance with the terms hereof, shall be fully paid and
nonassessable and are free from all taxes, Liens and charges with respect to
the
issuance thereof.
2.6 Authorization;
Enforcement; Validity.
The
Company has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement and each of the other agreements
or
instruments entered into by the parties hereto in connection with the
transactions contemplated by this Agreement (collectively, the “Transaction
Documents”) and to issue the Acquired Shares in accordance with the terms hereof
and thereof. The execution and delivery of the Transaction Documents by the
Company and the consummation by the Company of the transactions contemplated
hereby and thereby, including, without limitation, and the issuance of the
Acquired Shares, have been duly authorized by the board of directors of the
Company (the “Board”), and no further consent or authorization is required by
the Company, the Board or its stockholders. This Agreement and the other
Transaction Documents of even date herewith have been duly executed and
delivered by the Company, and constitute the legal, valid and binding
obligations of the Company enforceable against the Company in accordance with
their respective terms, except (i) as such enforceability may be limited by
general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally, the enforcement of applicable creditors’ rights and
remedies, or (ii) as any rights to indemnity or contribution hereunder may
be limited by federal and state securities laws and public policy
consideration.
2.7 No
Conflicts.
The
execution, delivery and performance of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated hereby
and
thereby will not (i) result in a violation of any articles or certificate
of incorporation, any certificate of designations, preferences and rights of
any
outstanding series of preferred stock or bylaws of the Company or any of its
Subsidiaries or (ii) conflict with, or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any rights of termination, amendment, acceleration or
cancellation of, any material agreement, indenture or instrument to which the
Company or any of its Subsidiaries is a party, or (iii) result in a
violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations) applicable to the Company
or
any of its Subsidiaries or by which any property or asset of the Company or
any
of its Subsidiaries is bound or affected, except in the case of
clauses (ii) and (iii), for such breaches or defaults as would not be
reasonably expected to have a Material Adverse Effect.
4
2.8 Governmental
Consents.
Except
for the filing of a Form D and Form 8-K with the SEC, the Company is not
required to obtain any consent, authorization or order of, or make any filing
or
registration with, any court, governmental agency or any regulatory or
self-regulatory agency or any other Person (as hereinafter defined) in order
for
it to execute, deliver or perform any of its obligations under or contemplated
by the Transaction Documents, in each case, in accordance with the terms hereof
or thereof. All consents, authorizations, orders, filings and registrations
which the Company is required to obtain at or prior to the Closing pursuant
to
the preceding sentence have been obtained or effected. The Company is unaware
of
any facts or circumstances which might prevent the Company from obtaining or
effecting any of the foregoing.
2.9 No
General Solicitation.
Neither
the Company, nor any of its affiliates, nor any Person acting on its or their
behalf, has engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D under the Securities Act) in connection
with
the offer or sale of the Acquired Shares.
2.10 No
Integrated Offering.
None of
the Company, its subsidiaries, any of their affiliates, and any Person acting
on
their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that
would require registration of the Acquired Shares under the Securities Act
or
cause this offering of the Acquired Shares to be integrated with prior offerings
by the Company for purposes of the Securities Act or any applicable stockholder
approval provisions.
2.11 Placement
Agent’s Fees.
No
brokerage or finder’s fee or commission are or will be payable to any Person
with respect to the transactions contemplated by this Agreement based upon
arrangements made by the Company or any of its affiliates.
2.12 Litigation.
Except
as set forth on Schedule
2.12,
There
is no action, suit, proceeding, inquiry or investigation before or by any court,
public board, government agency, self-regulatory organization or body pending
or, to the knowledge of the Company, threatened against or affecting the
Company, the transactions contemplated by the Transaction Documents, the Common
Stock or any of its Subsidiaries or any of their respective current or former
officers or directors in their capacities as such. To the knowledge of the
Company, there has not been within the past two (2) years, and there is not
pending, any investigation by the SEC involving the Company or any current
or
former director or officer of the Company (in his or her capacity as such).
The
SEC has not issued any stop order or other order suspending the effectiveness
of
any registration statement filed by the Company under the Securities Act within
the past two (2) years.
2.13 Indebtedness
and Other Contracts.
Except
as disclosed in the SEC Documents or otherwise set forth on Schedule
2.13,
neither
the Company nor any of its Subsidiaries (a) has any outstanding
Indebtedness (as defined below), (b) is a party to any contract, agreement
or instrument, the violation of which, or default under, by any other party
to
such contract, agreement or instrument would result in a Material Adverse
Effect, (c) is in violation of any term of or in default under any
contract, agreement or instrument relating to any Indebtedness, except where
such violations and defaults would not result, individually or in the aggregate,
in a Material Adverse Effect, or (d) is a party to any contract, agreement
or instrument relating to any Indebtedness, the performance of which, in the
judgment of the Company’s officers, has or is expected to have a Material
Adverse Effect. For purposes of this Agreement: (x) ”Indebtedness” of any
Person means, without duplication (i) all indebtedness for borrowed money,
(ii) all obligations issued, undertaken or assumed as the deferred purchase
price of property or services (other than trade payables entered into in the
ordinary course of business), (iii) all reimbursement or payment
obligations with respect to letters of credit, surety bonds and other similar
instruments, (iv) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses, (v) all
indebtedness created or arising under any conditional sale or other title
retention agreement, or incurred as financing, in either case with respect
to
any property or assets acquired with the proceeds of such indebtedness (even
though the rights and remedies of the seller or bank under such agreement in
the
event of default are limited to repossession or sale of such property),
(vi) all monetary obligations under any leasing or similar arrangement
which, in connection with generally accepted accounting principles, consistently
applied for the periods covered thereby, is classified as a capital lease,
(vii) all indebtedness referred to in clauses (i) through (vi) above
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any mortgage, lien, pledge, change,
security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by any Person, even though the
Person which owns such assets or property has not assumed or become liable
for
the payment of such indebtedness, and (viii) all Contingent Obligations in
respect of indebtedness or obligations of others of the kinds referred to in
clauses (i) through (vii) above; (y) ”Contingent Obligation”
means, as to any Person, any direct or indirect liability, contingent or
otherwise, of that Person with respect to any indebtedness, lease, dividend
or
other obligation of another Person if the primary purpose or intent of the
Person incurring such liability, or the primary effect thereof, is to provide
assurance to the obligee of such liability that such liability will be paid
or
discharged, or that any agreements relating thereto will be complied with,
or
that the holders of such liability will be protected (in whole or in part)
against loss with respect thereto; and (z) ”Person” means an individual, a
limited liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization and a government or any department or
agency thereof.
2.14 Financial
Information; SEC Documents.
Except
as set forth on Schedule
2.14,
the
Company has filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements
of the Exchange Act. As of their respective dates, the SEC Documents complied
in
all material respects with the requirements of the Exchange Act and the rules
and regulations of the SEC promulgated thereunder applicable to such SEC
Documents, and none of such SEC Documents, at the time they were filed with
the
SEC, 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 therein, in the light of the circumstances under which they were
made, not misleading. As of their respective dates, the financial statements
of
the Company included in such SEC Documents complied as to form in all material
respects with applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto. Such financial statements have
been
prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (i) as may be
otherwise indicated in such financial statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the extent they may
exclude footnotes or may be condensed or summary statements) and fairly present
in all material respects the financial position of the Company as of the dates
thereof and the results of its operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments). No other information provided by or on behalf of the Company
to
the Purchaser that is not included in the SEC Documents contains any untrue
statement of a material fact or omits to state any material fact necessary
in
order to make the statements therein, in the light of the circumstance under
which they are or were made, not misleading.
5
2.15 Absence
of Certain Changes.
Except
as disclosed in the SEC Documents, since December 31, 2005, there has been
no
material adverse change and no material adverse development in the business,
properties, operations, condition (financial or otherwise), results of
operations or prospects of the Company or its Subsidiaries. Since December
31,
2005, the Company has not (i) declared or paid any dividends,
(ii) sold any assets, individually or in the aggregate, in excess of
$50,000 outside of the ordinary course of business or (iii) had capital
expenditures, individually or in the aggregate, in excess of $100,000. The
Company has not taken any steps to seek protection pursuant to any bankruptcy
law nor does the Company have any knowledge or reason to believe that its
creditors intend to initiate involuntary bankruptcy proceedings or any actual
knowledge of any fact which would reasonably lead a creditor to do so. After
giving effect to the transactions contemplated hereby to occur at the Closing,
the Company will not be Insolvent (as hereinafter defined). For purposes of
this
Agreement, “Insolvent” means (i) the present fair saleable value of the
Company’s assets is less than the amount required to pay the Company’s total
indebtedness, contingent or otherwise, (ii) the Company is unable to pay
its debts and liabilities, subordinated, contingent or otherwise, as such debts
and liabilities become absolute and matured, (iii) the Company intends to
incur or believes that it will incur debts that would be beyond its ability
to
pay as such debts mature or (iv) the Company has unreasonably small capital
with which to conduct the business in which it is engaged as such business
is
now conducted and is proposed to be conducted.
2.16 Foreign
Corrupt Practices.
(a) Neither
the Company, nor any director, officer, agent, employee or other Person acting
on behalf of the Company has, in the course of its actions (a) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity, (b) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds, (c) violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended or
(d) made any unlawful bribe, rebate, payoff, influence payment, kickback or
other unlawful payment to any foreign or domestic government official or
employee.
(b) None
of
the Subsidiaries of the Company, nor any of their respective directors,
officers, agents, employees or other Persons acting on behalf of such
subsidiaries has, in the course of their respective actions (a) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity, (b) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds, (c) violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended or
(d) made any unlawful bribe, rebate, payoff, influence payment, kickback or
other unlawful payment to any foreign or domestic government official or
employee.
6
2.17 Transactions
With Affiliates.
Except
as set forth in the SEC Documents, none of the officers, directors or employees
of the Company is presently a party to any transaction with the Company or
any
of its Subsidiaries (other than for ordinary course services as employees,
officers or directors), including any contract, agreement or other arrangement
providing for the furnishing of services to or by, providing for rental of
real
or personal property to or from, or otherwise requiring payments to or from
any
such officer, director or employee or, to the knowledge of the Company, any
corporation, partnership, trust or other entity in which any such officer,
director, or employee has a substantial interest or is an officer, director,
trustee or partner.
2.18 Insurance.
The
Company and each of its Subsidiaries are insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts
as
management of the Company believes to be prudent and customary in the businesses
in which the Company and each of its Subsidiaries are engaged. Neither the
Company nor any of its Subsidiaries has been refused any insurance coverage
sought or applied for and neither the Company nor any of its Subsidiaries has
any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost that
would not have a Material Adverse Effect.
2.19 Employee
Relations.
Neither
the Company nor any of its Subsidiaries is a party to any collective bargaining
agreement or employs any member of a union. No Executive Officer of the Company
(as defined in Rule 501(f) of the Securities Act) has notified the Company
that such officer intends to leave the Company or otherwise terminate such
officer’s employment with the Company. No Executive Officer of the Company, to
the knowledge of the Company, is, or is now, in violation of any material term
of any employment contract, confidentiality, disclosure or proprietary
information agreement, non-competition agreement, or any other contract or
agreement or any restrictive covenant, and the continued employment of each
such
executive officer does not subject the Company or any of its Subsidiaries to
any
liability with respect to any of the foregoing matters. The Company and each
of
its Subsidiaries are in compliance with all federal, state, local and foreign
laws and regulations respecting employment and employment practices, terms
and
conditions of employment and wages and hours, except where failure to be in
compliance would not, either individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect.
2.20 Title.
Except
as set forth on Schedule
2.20,
the
Company and each of its Subsidiaries have good and marketable title to all
personal property owned by them which is material to their respective business,
in each case free and clear of all liens, encumbrances and defects except such
as are described in the SEC Documents or such as do not materially affect the
value of such property and do not interfere with the use made and proposed
to be
made of such property by the Company and its Subsidiaries. Any real property
and
facilities held under lease by the Company and each of its Subsidiaries are
held
by them under valid, subsisting and enforceable leases with such exceptions
as
are not material and do not interfere with the use made and proposed to be
made
of such property and buildings by the Company and each of its
Subsidiaries.
7
2.21 Intellectual
Property Rights.
Schedule
2.21
sets
forth a list of all of the Company’s patents, trademarks, trade names, service
marks copyrights, and registrations and applications therefor, trade secrets
and
any other intellectual property right (collectively, “Intellectual Property
Rights”), identifying whether owned by the Company, any of its Subsidiaries or a
third party. The Intellectual Property Rights are, to the best of the Company’s
knowledge, fully valid and are in full force and effect. The Company does not
have any knowledge of any infringement by the Company or any of its Subsidiaries
of Intellectual Property Rights of others. There is no claim, action or
proceeding being made or brought, or to the knowledge of the Company, being
threatened, against the Company or any of its Subsidiaries regarding its
Intellectual Property Rights that could have a Material Adverse Effect. The
Company is unaware of any facts or circumstances which might give rise to any
of
the foregoing infringements or claims, actions or proceedings. The Company
and
its Subsidiaries have taken reasonable security measures to protect the secrecy,
confidentiality and value of their Intellectual Property Rights.
2.22 Environmental
Laws.
The
Company and each of its Subsidiaries (a) are in compliance with any and all
Environmental Laws (as hereinafter defined), (b) have received all permits,
licenses or other approvals required of them under applicable Environmental
Laws
to conduct their respective businesses and (c) are in compliance with all
terms and conditions of any such permit, license or approval where, in each
of
the foregoing clauses (a), (b) and (c), the failure to so comply could be
reasonably expected to have, individually or in the aggregate, a Material
Adverse Effect. The term “Environmental Laws” means all federal, state, local or
foreign laws relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata), including, without limitation,
laws relating to emissions, discharges, releases or threatened releases of
chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes
(collectively, “Hazardous Materials”) into the environment, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials, as well as all
authorizations, codes, decrees, demands or demand letters, injunctions,
judgments, licenses, notices or notice letters, orders, permits, plans or
regulations issued, entered, promulgated or approved thereunder.
2.23 Tax
Matters.
The
Company and each of its Subsidiaries (a) have made or filed all federal and
state income and all other tax returns, reports and declarations required by
any
jurisdiction to which it is subject, (b) have paid all taxes and other
governmental assessments and charges that are material in amount, shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith and (c) have set aside on its books
reasonably adequate provision for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply,
except where such failure would not have a Material Adverse Effect. There are
no
unpaid taxes in any material amount claimed to be due by the taxing authority
of
any jurisdiction, and the officers of the Company know of no basis for any
such
claim.
8
2.24 ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act.
The
Company is in compliance with any and all requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act
of 2002 that are effective as of the date hereof and applicable to it, and
any
and all rules and regulations promulgated by the SEC thereunder that are
effective and applicable to it as of the date hereof, except where such
noncompliance would not have a Material Adverse Effect.
2.25 Investment
Company Status.
The
Company is not, and immediately after receipt of payment for the Acquired Shares
will not be, an “investment company,” an “affiliated person” of, “promoter” for
or “principal underwriter” for, or an entity “controlled” by an “investment
company,” within the meaning of the Investment Company Act.
2.26 Material
Contracts.
Each
contract of the Company that involves expenditures or receipts in excess of
$100,000 (each an “Applicable Contract”) is in full force and effect and is
valid and enforceable in accordance with its terms. The Company has not given
or
received from any other entity any notice or other communication (whether oral
or written) regarding any actual, alleged, possible or potential violation
or
breach of, or default under, any Applicable Contract.
2.27 Inventory.
All
inventory of the Company consists of a quality and quantity usable and salable
in the ordinary course of business, except for obsolete items and items of
below-standard quality, all of which have been or will be written off or written
down to net realizable value on the consolidated balance sheet of the Company
and its Subsidiaries as of December 31, 2006. The quantities of each type
of inventory (whether raw materials, work-in-process, or finished goods) are
not
excessive, but are reasonable and warranted in the present circumstances of
the
Company.
2.28 Disclosure.
The
Company confirms that neither it nor any other Person acting on its behalf
has
provided the Purchaser or its agents or counsel with any information that
constitutes or might constitute material, nonpublic information that has not
been disclosed in the SEC Documents. The Company understands and confirms that
the Purchaser will rely on the foregoing representations in effecting
transactions in securities of the Company. All
disclosure provided to the Purchaser regarding the Company, its business and
the
transactions contemplated hereby, including the Schedules to this Agreement,
furnished by or on behalf of the Company are true and correct and do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF THE PURCHASER
The
Purchaser hereby represents and warrants to the Company as of the date of this
Agreement as follows:
3.1 Organization.
The
Purchaser is a corporation, limited liability company or partnership duly
incorporated or organized, validly existing and in good standing under the
laws
of the jurisdiction of its incorporation or organization.
9
3.2 Authorization.
This
Agreement has been duly authorized, validly executed and delivered by the
Purchaser and is a valid and binding agreement and obligation of the Purchaser
enforceable against the Purchaser in accordance with its terms, subject to
limitations on enforcement by general principles of equity and by bankruptcy
or
other laws affecting the enforcement of creditors’ rights generally, and the
Purchaser has full power and authority to execute and deliver this Agreement
and
the other agreements and documents contemplated hereby and to perform its
obligations hereunder and thereunder.
3.3 Investment
Investigation.
The
Purchaser understands that no Federal, state, local or foreign governmental
body
or regulatory authority has made any finding or determination relating to the
fairness of an investment in the Acquired Shares and that no Federal, state,
local or foreign governmental body or regulatory authority has recommended
or
endorsed, or will recommend or endorse, any investment in the Acquired Shares.
The Purchaser, in making the decision to purchase the Acquired Shares, has
relied upon independent investigation made by it and has not relied on any
information or representations made by third parties.
3.4 Accredited
Investor.
The
Purchaser is an “accredited investor” as defined under Rule 501 of Regulation D
promulgated under the Securities Act.
3.5 No
Distribution.
The
Purchaser is and will be acquiring the Acquired Shares for its own account,
and
not with a view to any resale or distribution of the Acquired Shares in whole
or
in part, in violation of the Securities Act or any applicable securities
laws.
3.6 Resale.
The
parties intend that the offer and sale of the Acquired Shares be exempt from
registration under the Securities Act, by virtue of Section 4(2) and/or Rule
506
of Regulation D promulgated under the Securities Act. The Purchaser understands
that the Acquired Shares purchased hereunder have not been, and may never be,
registered under the Securities Act and that the Acquired Shares cannot be
sold
or transferred unless its is first registered under the Securities Act and
such
state and other securities laws as may be applicable or in the opinion of
counsel for the Company an exemption from registration under the Securities
Act
is available (and then the Acquired Shares may be sold or transferred only
in
compliance with such exemption and all applicable state and other securities
laws).
3.7 Reliance.
The
Purchaser understands that the Acquired Shares is being offered and sold to
it
in reliance on specific provisions of Federal and state securities laws and
that
the Company is relying upon the truth and accuracy of the representations,
warranties, agreements, acknowledgments and understandings of the Purchaser
set
forth herein for purposes of qualifying for exemptions from registration under
the Securities Act, and applicable state securities laws.
ARTICLE
IV
CONDITIONS
TO CLOSING OF THE PURCHASERS
The
obligation of the Purchaser to purchase the Acquired Shares at the Closing
is
subject to the fulfillment to the Purchaser’s satisfaction on or prior to the
Closing Date of each of the following conditions, any of which may be waived
by
the Purchaser:
4.1 Representations
and Warranties Correct.
The
representations and warranties in Article II hereof shall be true and correct
when made, and shall be true and correct on the Closing Date with the same
force
and effect as if they had been made on and as of the Closing Date.
10
4.2 Performance.
All
covenants, agreements and conditions contained in this Agreement to be performed
or complied with by the Company on or prior to the Closing Date shall have
been
performed or complied with by the Company in all material respects.
4.3 No
Impediments.
Neither
the Company nor any Purchaser shall be subject to any order, decree or
injunction of a court or administrative agency of competent jurisdiction that
prohibits the transactions contemplated hereby or would impose any material
limitation on the ability of such Purchaser to exercise full rights of ownership
of the Acquired Shares. At the time of the Closing, the purchase of the Acquired
Shares to be purchased by the Purchaser hereunder shall be legally permitted
by
all laws and regulations to which the Purchaser and the Company are
subject.
4.4 Other
Agreements and Documents.
Company
shall have executed and delivered the following agreements and
documents:
(a) A
certificate, registered in the name of the Purchaser, representing the Acquired
Shares;
(b) A
certificate of good standing with respect to the Company from the Secretary
of
State of Florida; and
(c) A
certificate of the Company’s Secretary, dated the Closing Date, certifying
(i) the fulfillment of the conditions specified in Sections 4.1 and 4.2 of
this Agreement, (ii) the Board resolutions approving this Agreement and the
transactions contemplated hereby, (iii) the Company’s certificate of
incorporation, and (iv) other matters as the Purchaser shall reasonably
request.
4.5 Due
Diligence Investigation.
No fact
shall have been discovered, whether or not reflected in the Schedules hereto,
which in the Purchaser’s determination would make the consummation of the
transactions contemplated by this Agreement not in the Purchaser’s best
interests.
ARTICLE
V
CONDITIONS
TO CLOSING OF THE COMPANY
The
Company’s obligation to sell the Acquired Shares at the Closing is subject to
the fulfillment to its satisfaction on or prior to the Closing Date of each
of
the following conditions:
5.1 Representations.
The
representations made by the Purchaser pursuant to Article III hereof shall
be true and correct when made and shall be true and correct on the Closing
Date.
5.2 No
Impediments.
Neither
the Company nor any Purchaser shall be subject to any order, decree or
injunction of a court or administrative agency of competent jurisdiction that
prohibits the transactions contemplated hereby or would impose any material
limitation on the ability of such Purchaser to exercise full rights of ownership
of the Acquired Shares. At the time of the Closing, the purchase of the Acquired
Shares to be purchased by the Purchaser hereunder shall be legally permitted
by
all laws and regulations to which the Purchaser and the Company are
subject.
11
5.3 Payment
of Purchase Price.
The
Company shall have received the Purchase Price.
ARTICLE
VI
INDEMNIFICATION
6.1 Indemnification
by the Company.
The
Company agrees to defend, indemnify and hold harmless the Purchaser and shall
reimburse the Purchaser for, from and against each claim, loss, liability,
cost
and expense (including without limitation, interest, penalties, costs of
preparation and investigation, and the reasonable fees, disbursements and
expenses of attorneys, accountants and other professional advisors)
(collectively, “Losses”) directly or indirectly relating to, resulting from or
arising out of any untrue representation, misrepresentation, breach of warranty
or non-fulfillment of any covenant, agreement or other obligation by or of
the
Company contained herein or in any certificate, document, or instrument
delivered to the Purchaser pursuant hereto.
6.2 Indemnification
by the Purchaser.
The
Purchaser agrees to defend, indemnify and hold harmless the Company and shall
reimburse the Company for, from and against all Losses directly or indirectly
relating to, resulting from or arising out of any untrue representation,
misrepresentation, breach of warranty or non-fulfillment of any covenant,
agreement or other obligation of the Purchaser contained herein or in any
certificate, document or instrument delivered to the Company pursuant
hereto.
6.3 Procedure.
The
indemnified party shall promptly notify the indemnifying party of any claim,
demand, action or proceeding for which indemnification will be sought under
Sections 6.1 or 6.2 of this Agreement, and, if such claim, demand, action or
proceeding is a third party claim, demand, action or proceeding, the
indemnifying party will have the right at its expense to assume the defense
thereof using counsel reasonably acceptable to the indemnified party. The
indemnified party shall have the right to participate, at its own expense,
with
respect to any such third party claim, demand, action or proceeding. In
connection with any such third party claim, demand, action or proceeding, the
Purchaser and the Company shall cooperate with each other and provide each
other
with access to relevant books and records in their possession. No such third
party claim, demand, action or proceeding shall be settled without the prior
written consent of the indemnified party, which shall not be unreasonably
withheld. If a firm written offer is made to settle any such third party claim,
demand, action or proceeding and the indemnifying party proposes to accept
such
settlement and the indemnified party refuses to consent to such settlement,
then: (i) the indemnifying party shall be excused from, and the indemnified
party shall be solely responsible for, all further defense of such third party
claim, demand, action or proceeding; and (ii) the maximum liability of the
indemnifying party relating to such third party claim, demand, action or
proceeding shall be the amount of the proposed settlement if the amount
thereafter recovered from the indemnified party on such third party claim,
demand, action or proceeding is greater than the amount of the proposed
settlement.
12
ARTICLE
VII
MISCELLANEOUS
7.1 Governing
Law.
This
Agreement and the rights of the parties hereunder shall be governed in all
respects by the laws of the State of New York wherein the terms of this
Agreement were negotiated, without regard to the conflicts of laws
thereof.
7.2 Survival.
Except
as specifically provided herein, the representations and warranties made herein
shall survive until the first anniversary of the Closing Date; provided that,
the covenants and agreements herein and the representations and warranties
contained in Sections 2.1, 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.11, and 2.28 hereof
shall survive indefinitely.
7.3 Amendment.
This
Agreement may not be amended, discharged or terminated (or any provision hereof
waived) without the written consent of the Company and the Purchaser.
7.4 Successors
and Assigns.
Except
as otherwise expressly provided herein, the provisions hereof shall inure to
the
benefit of, and be binding upon and enforceable by and against, the successors,
assigns, heirs, executors and administrators of the parties hereto. The
Purchaser may assign its rights hereunder, and the Company may not assign its
rights or obligations hereunder without the consent of the Purchaser or any
of
its successors, assigns, heirs, executors and administrators.
7.5 Entire
Agreement.
This
Agreement, the Transaction Documents and the other documents delivered pursuant
hereto and simultaneously herewith constitute the full and entire understanding
and agreement between the parties with regard to the subject matter hereof
and
thereof.
7.6 Notices,
etc.
All
notices, demands or other communications given hereunder shall be in writing
and
shall be sufficiently given if delivered either personally or by a nationally
recognized courier service marked for next business day delivery or sent in
a
sealed envelope by first class mail, postage prepaid and either registered
or
certified, addressed as follows:
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(a)
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if
to the Company:
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▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇
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||
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▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
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||
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Attn:
▇▇▇▇▇▇ ▇▇▇▇▇, Chief Executive Officer
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||
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(b)
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if
to a Purchaser:
|
|
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Vicis
Capital Master Fund
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▇▇▇▇▇
▇▇, ▇▇▇▇▇ ▇▇▇
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▇▇▇
▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
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||
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▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
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||
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Attn:
▇▇▇▇ ▇▇▇▇▇▇▇▇
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13
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with
a copy to:
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|||
| ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq. | |||
| ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP | |||
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▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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|||
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▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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7.7 Delays
or Omissions.
No
delay or omission to exercise any right, power or remedy accruing to any holder
of any Acquired Shares upon any breach or default of the Company under this
Agreement shall impair any such right, power or remedy of such holder nor shall
it be construed to be a waiver of any such breach or default, or an
acquiescence, therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring.
Any
waiver, permit, consent or approval of any kind or character on the part of
any
holder of any breach or default under this Agreement, or any waiver on the
part
of any holder of any provisions or conditions of this Agreement must be, made
in
writing and shall be effective only to the extent specifically set forth in
such
writing. All remedies, either under this Agreement or by law or otherwise
afforded to any holder, shall be cumulative and not alternative.
7.8 Severability.
The
invalidity of any provision or portion of a provision of this Agreement shall
not affect the validity of any other provision of this Agreement or the
remaining portion of the applicable provision. It is the desire and intent
of
the parties hereto that the provisions of this Agreement shall be enforced
to
the fullest extent permissible under the laws and public policies applied in
each jurisdiction in which enforcement is sought. Accordingly, if any particular
provision of this Agreement shall be adjudicated to be invalid or unenforceable,
such provision shall be deemed amended to delete therefrom the portion thus
adjudicated to be invalid or unenforceable, such deletion to apply only with
respect to the operation of such provision in the particular jurisdiction in
which such adjudication is made.
7.9 [Intentionally
Omitted].
7.10 Consent
to Jurisdiction; Waiver of Jury Trial.
EACH
OF
THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS
TO
THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED THE STATE
AND
COUNTY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE TRANSACTION DOCUMENTS. EACH OF THE PARTIES
TO
THIS AGREEMENT IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY
OBJECTION WHICH SUCH PARTY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN ANY SUCH COURTS AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN ANY SUCH COURTS HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, ANY RIGHT TO TRIAL BY JURY IN ANY SUCH LEGAL PROCEEDING. EACH OF THE
PARTIES TO THIS AGREEMENT HEREBY CONSENTS TO SERVICE OF PROCESS BY NOTICE IN
THE
MANNER SPECIFIED IN SECTION 7.6 AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION SUCH PARTY MAY NOW OR HEREAFTER HAVE
TO
SERVICE OF PROCESS IN SUCH MANNER.
14
7.11 Titles
and Subtitles.
The
titles of the articles, sections and subsections of this Agreement are for
convenience of reference only and are not to be considered in construing this
Agreement.
7.12 Further
Assurances.
The
parties agree to execute and deliver all such further documents, agreements
and
instruments and take such other and further action as may be necessary or
appropriate to carry out the purposes and intent of this Agreement.
7.13 Counterparts.
This
Agreement may be executed in any number of counterparts, each of which shall
be
an original, but all of which together shall constitute one
instrument.
7.14 Adjustments
Pursuant to Ratchet Provisions.
(a) Adjustment
to Warrants.
The
parties agree and acknowledge that as a result of that certain Stock Purchase
Agreement, dated April 13, 2007, between the parties, the exercise price of
the
Warrants was ratcheted down to $.01 per share.
(b) Adjustment
to the Preferred Shares and Notes.
Notwithstanding the fact that as a result of the issuance of the Acquired Shares
hereunder, the Ratchet Provisions applicable to the Preferred Shares and the
Notes would require the Company to adjust the conversion price of all such
Preferred Shares and the Notes to $.01 per share of Common Stock, the Purchaser
agrees to waive, in connection with this transaction only, its right to require
the Company to adjust such conversion prices. The parties agree that (i) the
foregoing waiver shall
not
be deemed to be a waiver of such right with respect to any future transactions
by the Company, (ii) that the foregoing waiver shall not preclude the Purchaser
from further enforcement of the Ratchet Provisions, and (iii) in the event
the
Company breaches its representations and warranties contained in Section 2.4(c),
in addition to any other remedies available to Purchaser, (y) the foregoing
waiver shall automatically be rescinded and shall no longer be of any force
or
effect and (z) the Company shall pay to the Purchaser as liquidated damages
$100,000 in cash.
15
IN
WITNESS WHEREOF, the parties hereto have duly executed this Stock Purchase
Agreement, as of the day and year first above written.
| COMPANY: | ||
| MEDICAL MEDIA TELEVISION, INC. | ||
| |
|
|
| /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | ||
|
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ |
||
| President and Chief Executive Officer | ||
| PURCHASER: | ||
| VICIS CAPITAL MASTER FUND | ||
| By: Vicis Capital LLC | ||
| /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ | ||
|
▇▇▇▇▇ ▇▇▇▇▇▇ |
||
| Chief Financial Officer | ||