EXHIBIT 10.37
JANUARY BRIDGE NOTE CONVERSION AND WARRANT PURCHASE AGREEMENT
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THIS JANUARY BRIDGE NOTE CONVERSION AND WARRANT PURCHASE AGREEMENT
("Agreement") is made as of the 17th day of August, 2007 by and among INTRAOP
MEDICAL CORPORATION, a Nevada corporation (the "Company") and the persons listed
on Exhibit A attached hereto (each a "Holder" and collectively the "Holders").
Recitals
A. The Holders hold 8% debentures issued by the Company on January 10,
2007 in an aggregate principal amount of $771,430.37.
B. The Company and the Holders desire to retire such debentures in
exchange for an aggregate cash payment of four hundred thousand dollars
($400,000) and warrants to purchase an aggregate of 5,000,000 shares of the
Company's Common Stock.
C. This Agreement is being delivered in connection with the Common
Stock and Warrant Purchase Agreement dated as of August 17, 2007 by and among
the Company and the other persons set forth on the schedule of purchasers
attached thereto.
D. This Agreement shall be binding upon the Company and the Holders
only upon delivery of the signatures pages hereto by the Company and the
Holders.
Agreement
In consideration of the mutual promises made herein and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Definitions. In addition to those terms defined above and elsewhere
in this Agreement, for the purposes of this Agreement, the following terms shall
have the meanings set forth below:
"First Closing" shall have the meaning set forth in the
Purchase Agreement.
"January Bridge Notes" means the 8% debentures dated January
10, 2007 listed on Exhibit A attached hereto in the aggregate principal amount
of $771,430.37.
"January Bridge Note Warrants" means warrants in substantially
the form attached hereto as Exhibit B.
"January Bridge Note Warrant Shares" means the shares of the
Company's Common Stock issuable upon exercise of the January Bridge Note
Warrants.
"January Securities Purchase Agreement" means the Securities
Purchase Agreement dated as of January 10, 2007 by and among the Company and the
Holders.
"Purchase Agreement" means the Common Stock and Warrant
Purchase Agreement dated as of August ___, 2007 by and among the Company and the
other persons set forth on the schedule of purchasers attached thereto.
"Second Closing" shall have the meaning set forth in the
Purchase Agreement.
"Securities" means the January Bridge Note Warrants and the
January Bridge Note Warrant Shares.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
2. Surrender and Cancellation of the January Bridge Notes.
2.1 Surrender and Cancellation of the January Bridge Notes.
Upon the terms and subject to the conditions set forth in this Agreement, at the
First Closing, each Holder shall surrender to the Company the January Bridge
Note held by such Holder marked "paid in full" in exchange for (i) a cash
payment equal to the outstanding principal amount of the January Bridge Note
held by such Holder multiplied by 0.518517 and (ii) a January Bridge Note
Warrant to purchase that number of January Bridge Note Shares equal to the
outstanding principal amount of the January Bridge Note held by such Holder
multiplied by 6.481473, in complete satisfaction of all principal and accrued
interest under such January Bridge Note. Fractional shares shall be rounded down
to the nearest whole share. Upon such conversion, the January Bridge Notes shall
cease to represent indebtedness of the Company as stated therein and the sole
right of the Holder thereof shall be to receive the cash payment and January
Bridge Note Warrant to which such Holder has become entitled pursuant to the
terms hereof.
2.2 Exercise of January Bridge Note Warrants. At or within ten
(10) days after the Second Closing, each Holder of a January Bridge Note Warrant
shall exercise the remaining balance of such warrant in full.
2.3 Release of Liabilities. Except with respect to the
obligations set forth in this Agreement, upon the First Closing each Holder
shall, for itself and its legal successors and assigns release and forever
discharge the Company and its stockholders, partners, directors, officers,
employees, agents, attorneys, legal successors and assigns of and from any and
all claims, demands, damages, debts, liabilities, accounts, reckonings,
obligations, costs, expenses, liens, actions and causes of action of every kind
and nature whether now known or unknown, suspected or unsuspected which it
either now has, owns or holds or at any time before ever owned or held or could,
shall or may in the future have, own or hold against the Company or such
stockholders, partners, directors, officers, employees, agents, attorneys, legal
successors and assigns based upon or arising out of any matter, cause, fact,
thing, act, or omission related to the January Bridge Notes occurring or
existing at any time up to and including the effective date of this Agreement
(collectively the "Released Matters"). It is the intention of each Holder in
executing this Agreement and in receiving the cash payment and a January Bridge
Note Warrant provided hereby that this Agreement shall be effective as a full
and final accord and satisfaction and general release of and from all Released
Matters. In furtherance of the intentions set forth in this Agreement, each
Holder acknowledges that it is familiar with California Civil Code Section 1542
which provides as follows:
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GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE
TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER
MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR.
Each Holder waives and relinquishes any rights or benefits which it has
or may have under Section 1542 or any similar provision of the law of any other
jurisdiction to the full extent that it may lawfully waive its rights and
benefits pertaining to the Released Matters.
3. Waiver of Default under the January Bridge Notes. Each Holder hereby
waives any Event of Default arising under Section 2.(a)(vi) of such Holder's
January Bridge Note to the extent the transactions contemplated by the Purchase
Agreement are deemed to be a "Change of Control Transaction" as defined in
Section 2.(a)(vi) of the January Bridge Notes. This waiver shall not be deemed
to be a continuing waiver in the future or a waiver of any other provision,
condition or requirement of the January Bridge Notes.
4. Waiver of Participation Right. Each Holder hereby waives the
provisions of Section 4.13 (Participation in Future Financing) of the January
Securities Purchase Agreement with respect to the transactions contemplated by
the Purchase Agreement. This waiver shall not be deemed to be a continuing
waiver in the future or a waiver of any other provision, condition or
requirement of the January Securities Purchase Agreement.
5. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Holders that:
5.1 Organization and Good Standing. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Nevada and has all requisite corporate power and authority to
carry on its business as now conducted and to own its properties.
5.2 Authorization. The Company has full corporate power and
authority and has taken all requisite action on the part of the Company, its
officers, directors and stockholders necessary for (i) the authorization,
execution and delivery of this Agreement, (ii) the authorization of the
performance of all obligations of the Company hereunder and (iii) the
authorization, issuance, sale and delivery of the Securities subject, in the
case of the January Bridge Note Warrant Shares, to stockholder approval and
filing of an amendment to the Company's Amended and Restated Articles of
Incorporation authorizing an increase in the number of shares of Common Stock
issuable by the Company to 500,000,000 (as adjusted for stock splits,
combinations or other similar transactions). This Agreement constitutes the
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights generally.
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5.3 Valid Issuance. The Securities have been duly and validly
authorized. The January Bridge Note Warrant Shares have been reserved for
issuance, subject to stockholder approval and filing of an amendment to the
Company's Amended and Restated Articles of Incorporation authorizing an increase
in the number of shares of Common Stock issuable by the Company to 500,000,000
(as adjusted for stock splits, combinations or other similar transactions), and,
upon issuance pursuant to the January Bridge Note Warrants, will be duly and
validly issued and fully paid and nonassessable.
5.4 Consents. The execution, delivery and performance by the
Company of this Agreement and the offer, issuance and sale of the Securities
requires no consent of, action by or in respect of, or filing with, any person,
governmental body, agency, or official other than filings that have been made
pursuant to applicable state securities laws and post-sale filings pursuant to
applicable state and federal securities laws which the Company undertakes to
file within the applicable time periods.
5.5 Private Placement. Subject to the accuracy of each
Holder's representations in Section 6 hereof, the offer and sale of the
Securities to the Holders as contemplated hereby is exempt from the registration
requirements of the Securities Act.
6. Representations and Warranties of the Holders. Each of the Holders
hereby, severally and not jointly, represents and warrants to the Company that:
6.1 Organization and Existence. Such Holder is a validly
existing corporation, limited partnership or limited liability company and has
all requisite corporate, partnership or limited liability company power and
authority to invest in the Securities pursuant to this Agreement.
6.2 Authorization. The execution, delivery and performance by
such Holder of this Agreement have been duly authorized, and this Agreement
constitutes the valid and legally binding obligations of such Holder,
enforceable against such Holder in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability, relating to or affecting creditors'
rights generally.
6.3 Purchase Entirely for Own Account. The Securities to be
received by such Holder hereunder will be acquired for such Holder's own
account, not as nominee or agent, and not with a view to the resale or
distribution of any part thereof in violation of the Securities Act, and such
Holder has no present intention of selling, granting any participation in, or
otherwise distributing the same in violation of the Securities Act.
6.4 Investment Experience. Such Holder acknowledges that it
can bear the economic risk and complete loss of its investment in the Securities
and has such knowledge and experience in financial or business matters that it
is capable of evaluating the merits and risks of the investment in the
Securities contemplated hereby.
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6.5 Disclosure of Information. Such Holder has had an
opportunity to receive all information related to the Company requested by it
and to ask questions of and receive answers from the Company regarding the
Company, its business and the terms and conditions of the offering of the
Securities.
6.6 Restricted Securities. Such Holder understands that the
Securities are characterized as "restricted securities" under the U.S. federal
securities laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under such laws and
applicable regulations such securities may be resold without registration under
the Securities Act only in certain limited circumstances.
6.7 Legends. It is understood that, except as provided below,
certificates evidencing the Securities may bear the following or any similar
legend:
(a) "THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAWS. THE SECURITIES REPRESENTED HEREBY MAY NOT BE
TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO
THE SECURITIES ACT, (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144(K), OR
(III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS."
(b) If required by the authorities of any state in
connection with the issuance of sale of the Securities, the legend required by
such state authority.
6.8 Accredited Investor. Such Holder is an "accredited
investor" as defined in Rule 501(a) of Regulation D under the Securities Act.
6.9 No General Solicitation. Such Holder did not learn of the
investment in the Securities as a result of any public advertising or general
solicitation.
7. Miscellaneous.
7.1 Successors and Assigns. This Agreement may not be assigned
by a party hereto without the prior written consent of (i) the Company and (ii)
the Holders holding a majority of the Securities held by all Holders. The
provisions of this Agreement shall inure to the benefit of and be binding upon
the respective permitted successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
7.2 Counterparts; Faxes. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. This Agreement may
also be executed via facsimile or PDF, which shall be deemed an original.
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7.3 Titles and Subtitles. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
7.4 Notices. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given as hereinafter described (i) if given by personal delivery,
then such notice shall be deemed given upon such delivery, (ii) if given by
facsimile or electronic mail, then such notice shall be deemed given upon
receipt of confirmation of complete transmittal, (iii) if given by mail, then
such notice shall be deemed given upon the earlier of (A) receipt of such notice
by the recipient or (B) three (3) days after such notice is deposited in first
class mail, postage prepaid, and (iv) if given by an internationally recognized
overnight air courier, then such notice shall be deemed given one (1) Business
Day after delivery to such carrier. All notices shall be addressed to the party
to be notified at the address as follows, or at such other address as such party
may designate by ten (10) days' advance written notice to the other party:
If to the Company:
Intraop Medical Corporation
▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇, LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Holders, to the addresses on file with the
Company.
7.5 Expenses. The parties hereto shall pay their own costs and
expenses in connection herewith.
7.6 Amendments and Waivers. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or prospectively)
only with the written consent of (i) the Company and (ii) the Holders holding a
majority of the Securities held by all Holders. Any amendment or waiver effected
in accordance with this paragraph shall be binding upon each holder of any
Securities purchased under this Agreement at the time outstanding, each future
holder of all such Securities and the Company.
7.7 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof but shall be interpreted as if it
were written so as to be enforceable to the maximum extent permitted by
applicable law, and any such prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereby
waive any provision of law which renders any provision hereof prohibited or
unenforceable in any respect.
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7.8 Entire Agreement. This Agreement, including the exhibits,
constitute the entire agreement among the parties hereof with respect to the
subject matter hereof and thereof and supersede all prior agreements and
understandings, both oral and written, between the parties with respect to the
subject matter hereof and thereof.
7.9 Further Assurances. The parties shall execute and deliver
all such further instruments and documents and take all such other actions as
may reasonably be required to carry out the transactions contemplated hereby and
to evidence the fulfillment of the agreements herein contained.
7.10 Governing Law; Consent to Jurisdiction; Waiver of Jury
Trial. This Agreement shall be governed by, and construed in accordance with,
the internal laws of the State of Delaware without regard to the choice of law
principles thereof. Each of the parties hereto irrevocably submits to the
exclusive jurisdiction of the courts of the State of California located in Santa
▇▇▇▇▇ County and the United States District Court for the Northern District of
California for the purpose of any suit, action, proceeding or judgment relating
to or arising out of this Agreement and the transactions contemplated hereby.
Service of process in connection with any such suit, action or proceeding may be
served on each party hereto anywhere in the world by the same methods as are
specified for the giving of notices under this Agreement. Each of the parties
hereto irrevocably consents to the jurisdiction of any such court in any such
suit, action or proceeding and to the laying of venue in such court. Each party
hereto irrevocably waives any objection to the laying of venue of any such suit,
action or proceeding brought in such courts and irrevocably waives any claim
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO
REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND
REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.
(Signature page follows)
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IN WITNESS WHEREOF, the parties have executed this January
Bridge Note Conversion and Warrant Purchase Agreement as of the date first above
written.
The Company: INTRAOP MEDICAL CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. Goer
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Name: ▇▇▇▇▇▇ ▇. Goer
Title: President and CEO
IN WITNESS WHEREOF, the parties have executed this January Bridge Note
Conversion and Warrant Purchase Agreement.
Holders: Name of Holder: Bushido Capital Master Fund L.P.
Signature of Authorized Signer: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Print Name of Authorized Signer: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Print Title of Authorized Signer
(if applicable): Director
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Name of Holder: Gamma Opportunity Capital
Partners LP Class A
Signature of Authorized Signer: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Print Name of Authorized Signer: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Print Title of Authorized Signer
(if applicable): As Agent
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Name of Holder: Gamma Opportunity Capital
Partners LP Class C
Signature of Authorized Signer: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Print Name of Authorized Signer: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Print Title of Authorized Signer
(if applicable): As Agent
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Name of Holder: Crestview Capital Master, LLC
Signature of Authorized Signer: /s/ ▇▇▇▇▇▇ ▇▇▇▇
---------------------------------
Print Name of Authorized Signer: ▇▇▇▇▇▇ ▇▇▇▇
---------------------------------
Print Title of Authorized Signer
(if applicable): Manager
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Name of Holder: Dolphin Offshore Partners, L.P.
Signature of Authorized Signer: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Print Name of Authorized Signer: ▇▇▇▇▇ ▇▇▇▇▇
---------------------------------
Print Title of Authorized Signer
(if applicable): General Partner
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Name of Holder: Alpha Capital Anstaht.
Signature of Authorized Signer: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Print Name of Authorized Signer: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Print Title of Authorized Signer
(if applicable): Director
---------------------------------
EXHIBIT A
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Principal Amount of
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Holder January Bridge Note
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Bushido Capital Master Fund L.P. $171,429.57
Gamma Opportunity Capital
Partners LP Class A $85,714.50
Gamma Opportunity Capital
Partners LP Class C $85,714.50
Crestview Capital Master, LLC $214,286.80
Dolphin Offshore Partners, L. P. $128,571.00
Alpha Capital Anstaht $85,714.00
TOTAL: $771,430.37
EXHIBIT B
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Form of January Bridge Note Warrant
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