EXHIBIT 10.3
PUT AND CALL AGREEMENTS DATED OCTOBER 10, 1997 BETWEEN THE COMPANY AND THE
INVESTORS
PUT AND CALL AGREEMENT
This PUT AND CALL AGREEMENT (this "Agreement") dated as of October 10,
1997, is entered into by and among VITECH AMERICA, INC. (the "Company"), a
Florida corporation, and INFINITY INVESTORS LIMITED, a Nevis, West Indies
corporation, INFINITY EMERGING OPPORTUNITIES LIMITED, a Nevis, West Indies
corporation, and GLACIER CAPITAL LIMITED, a Nevis, West Indies corporation and
SUMMIT CAPITAL LIMITED, a Nevis West Indies corporation (collectively, the
"Purchasers").
WITNESSETH
WHEREAS, the Purchasers are entering into a Securities Purchase
Agreement with the Company (the "Securities Purchase Agreement"), in respect of
which the Purchasers have agreed to purchase $20,000,000 aggregate principal
amount of the Company's 10% Convertible Notes due October 10, 2000 (the
"Notes");
WHEREAS, the Notes are convertible into common stock of the Company
(the "Common Stock") at the conversion price defined in the Notes (such Common
Stock, when issued upon conversion of the Notes, being referred to herein as
"Conversion Shares"); and
WHEREAS, the Company has agreed to grant the Purchasers certain rights
with respect to the Notes and Conversion Shares as an inducement to, and a
condition of, the Purchasers' purchase of the Notes.
NOW THEREFORE, the parties hereto agree as follows:
1. GENERAL. Capitalized terms not otherwise defined herein have the meaning
defined in the Securities Purchase Agreement.
2. PUT OPTION.
(a) Commencing one year after the date hereof (the "First Put Date"),
and continuing for a period of thirty (30) days thereafter, each holder of the
Notes shall have the right (the "First Put Right") to request that the Company
repurchase all, but not less than all, of the outstanding Notes (the "Put
Option") at a price equal to one hundred and ten percent (110%) of the principal
amount thereof, plus accrued and unpaid interest thereon (the "Put Price"), by
delivering to the Company a written notice specifying (i) the number of
Conversion Shares that are subject to the Put Option which shall be all the
Notes of the Noteholder, (ii) the aggregate Put Price, and (iii) the date, not
earlier than twenty (20) Trading Days and not later than thirty (30) days after
the First Put Date, on which the Put Option shall be exercised (the "First Put
Exercise Date").
(b) Commencing one hundred eighty (180) days after the First Put Date
and continuing for a period of thirty (30) days thereafter, each holder of the
Notes shall have a second right (the "Second Put Right") to request that the
Company repurchase all, but not less than all, of
the outstanding Notes at a price equal to one hundred and fifteen percent (115%)
of the principal amount thereof plus accrued and unpaid interest thereon (the
"Second Put Price" and together with the First Put Right sometimes referred to
collectively as the "Put Rights"), by delivering to the Company a written notice
specifying (i) the number of Conversion Shares that are subject to the Put
Option, (ii) the Second Put Price, and (iii) the date, not earlier than twenty
(20) days and not later than thirty (30) days on which the Put Option shall be
exercised (the "Second Put Exercise Date").
(c) Upon receipt by the Company of a notice exercising the First Put
Right and/or Second Put Right, the Company shall, within fifteen (15) days of
receipt of such notice, deliver to each holder of the Notes exercising the First
Put Right or Second Put Right, as applicable, a notice stating whether the
Company agrees to repurchase all, but not less than all, of the outstanding
Notes subject to the First Put Right or Second Put Right, as applicable. In the
event the Company delivers notice of its agreement to effect such repurchase (a
"Company Acceptance Notice"), the provisions in subsection (d) below shall
apply. In the event the Company declines to repurchase the outstanding Notes
subject to the First Put Right and/or Second Put Right, as applicable, the Notes
shall remain convertible pursuant to their terms at the option of the holders
thereof.
(d) Assuming the Company has delivered a Company Acceptance Notice, on
the First Put Exercise Date or the Second Put Exercise Date, as applicable, (i)
the Purchaser shall deliver to the Company the Notes, properly endorsed,
representing the Notes subject to the Put Option, and (ii) the Company shall
deliver to the Purchasers, in immediately available funds, the applicable Put
Price. The purchase price for any Put Right shall be paid in four (4) equal
monthly installments on the last Business Day of each month commencing on the
first full month following the First Put Exercise Date or the Second Put
Exercise Date, as the case may be, with interest on each installment at the rate
of ten percent (10%) per annum.
3. CALL OPTION.
(a) The Company shall have the right, at any time and from time to time
commencing one (1) year after the Closing Date, to purchase from any holder of
the Notes (the "Call Option") the Notes at a call price of one hundred and
twelve percent (112%) of the principal amount, plus accrued and unpaid interest
thereon (the "Call Price") by delivering to the Purchasers a written notice
specifying (i) the number of Conversion Shares that are subject to the Call
Option, (ii) the Call Price, and (iii) the date, not earlier than twenty (20)
Trading Days and not later than thirty (30) days, on which the Call Option shall
be exercised (the "Call Exercise Date"). Commencing on the first day of the
thirteenth (13th) month from the date hereof (November 1, 1998) and on each
month thereafter until the Maturity Date, the Call Price shall be increased by
one percent (1%) per month.
(b) On the Call Exercise Date (i) the Purchasers shall deliver to the
Company the Notes, properly endorsed, representing the Notes subject to the Call
Option and (ii) the Company shall deliver to the Purchasers, in immediately
available funds, the applicable Call Price.
(c) The Call Option provisions described in this Section 3 shall at all
times be subject to (i) the prior Conversion Rights of the Purchasers and (ii)
the following limitations: (A) no more than 8.33% of the outstanding principal
balance of the Notes may be called at any one time; (B) at least thirty (30)
calendar days must elapsed between Call Options; (C) Call Options will be
effected pro rata among the Purchasers in the manner set forth in Section 3.4 of
the Securities Purchase Agreement; and (D) the shares of Common Stock underlying
the Notes must be covered by an effective resale registration statement pursuant
to the terms of the Securities Purchase Agreement at the time of the Call Notice
and on the Call Exercise Date.
4. MISCELLANEOUS.
(a) PAYMENT METHOD. The payment of the Put Price or the Call Price, as
the case may be, shall be made by wire transfer or bank draft in immediately
available funds to each applicable Purchaser.
(b) NO ASSIGNMENT OR TRANSFER. Neither this Agreement, nor the Put
Option or the Call Option granted hereby, nor any other rights under this
Agreement, shall be assignable or transferable, directly or indirectly.
(c) NOTICES. All notices, requests and demands to or upon the parties
hereto shall be in writing and shall be delivered by any method that shall
provide a written acknowledgment of receipt at the addresses shown below.
If to Vitech America, Inc. Vitech America, Inc.,
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Attn: ▇▇. ▇▇▇▇▇▇▇ St. Laurent
Telefax:
With a copy to: Atlas, ▇▇▇▇▇▇▇, Trop & Borkson
New River Center, Ste. 1900
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Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Purchaser ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Attn: ▇. ▇. ▇▇▇▇▇▇▇▇
Telefax: 011-44-171-355-4975
with a copy to: HW Partners, L.P.
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Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
Telefax: (▇▇▇)▇▇▇-▇▇▇▇
For purposes of this Agreement, a "Notice Date" shall be the date which
is two (2) business days after the date on which any notice hereunder is sent by
telecopy (provided, however, that it is telephonically or electronically
confirmed).
(f) FURTHER ASSURANCES. The parties agree to do all things and to
deliver all instruments and documents necessary to accomplish the purposes of
this Agreement, and to provide to one another such information and assistance
necessary to enable one another to do the same.
(g) GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be governed by and construed in accordance with the laws
of the State of New York.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have executed this Agreement this 10th
day of October, 1997.
INFINITY INVESTORS LIMITED
By: /s/ ▇▇▇▇▇ ▇▇▇▇
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Title:
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INFINITY EMERGING OPPORTUNITIES
LIMITED
By: /s/ ▇▇▇▇▇ ▇▇▇▇
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Title:
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GLACIER CAPITAL LIMITED
By: /s/ ▇▇▇▇▇ ▇▇▇▇
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Title:
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SUMMIT CAPITAL LIMITED
By: /s/ ▇▇▇▇▇ ▇▇▇▇
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Name:
Title:
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ACCEPTED AND ACKNOWLEDGED:
VITECH AMERICA, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
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Title: CFO