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Private Equity Line of Credit Agreement

 

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Title:

Private Equity Line of Credit Agreement

Entities:

Integrated Surgical Systems Inc.; Nasdaq Stock Market Inc.; Epstein Becker & Green

Date:

2000

Size:

Preview shows 18KB of 177KB total

Price:

$73

ID:

#883231

 

 

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PRIVATE EQUITY LINE OF CREDIT AGREEMENT

between

Integrated Surgical Systems, Inc.

and

Triton West Group, Inc.

PRIVATE EQUITY LINE OF CREDIT AGREEMENT dated as of September 15, 2000 (the "Agreement"), between Integrated Surgical Systems, Inc., a corporation organized and existing under the laws of the State of Delaware (the "Company"), and Triton West Group, Inc., a corporation organized and existing under the laws of the Cayman Islands (the "Investor").

WHEREAS, the Investor desires to purchase from the Company, and the Company is willing to sell to the Investor, from time to time, up to $12,000,000 (the "Aggregate Purchase Price") of the Company's common stock, par value $.01 per share (the "Common Stock"), on the terms and subject to the conditions set forth in this Agreement;

WHEREAS, such investments will be made by the Investor as a statutory underwriter of a registered indirect primary offering of such Common Stock by the Company;

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE I
Certain Definitions

Section 1.1 "Bid Price" shall mean the closing bid price (as reported by Bloomberg L.P.) of the Common Stock on the Principal Market.

Section 1.2 "Capital Shares" shall mean the Common Stock and any shares of any other class of common stock whether now or hereafter authorized, having the right to participate in the distribution of earnings and assets of the Company.

Section 1.3 "Capital Shares Equivalents" shall mean any securities, rights, or obligations that are convertible into or exchangeable for or give any right to subscribe for any Capital Shares of the Company or any warrants, options or other rights to subscribe for or purchase Capital Shares or any such convertible or exchangeable securities.

Section 1.4 "Closing" shall mean one of the closings of a purchase and sale of the Common Stock pursuant to Section 2.1.

Section 1.5 "Closing Date" shall mean, with respect to a Closing, the seventh Trading Day following the Put Date related to such Closing, provided all conditions to such Closing have been satisfied on or before such Trading Day.

Section 1.6 "Commitment Amount" shall mean the $12,000,000 up to which the Investor has agreed to provide to the Company in order to purchase the Put Shares pursuant to the terms and conditions of this Agreement.

Section 1.7 "Commitment Period" shall mean the period commencing on the Effective Date and expiring on the earliest to occur of (x) the date on which the Investor shall have purchased Put Shares pursuant to this Agreement for an aggregate Purchase Price of $12,000,000, (y) the date this Agreement is terminated pursuant to Section 2.4, or (z) the date occurring three years from the date of commencement of the Commitment Period.

Section 1.8 "Common Stock" shall mean the Company's common stock, par value $.01 per share.

Section 1.9 "Condition Satisfaction Date" shall have the meaning set forth in Section 7.2.

Section 1.10 "Effective Date" shall mean the date on which the SEC first declares effective a Registration Statement registering the sale by the Company and resale by the Investor of the Registrable Securities as set forth in Section 7.2(e).

Section 1.11 "Escrow Agent" shall mean the escrow agent designated in the Escrow Agreement.

Section 1.12 "Escrow Agreement" shall mean the escrow agreement in the form attached hereto as Exhibit A.

Section 1.13"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

Section 1.14 "Investment Amount" shall mean the total dollar amount to be invested by the Investor to purchase Put Shares with respect to any Put Date as notified by the Company to the Investor, all in accordance with Section 2.2 hereof.

Section 1.15 "Market Price" on any given date shall mean the lowest Bid Price (as reported by Bloomberg L.P.) of the Common Stock during the Valuation Period relating to such date.

Section 1.16 "Material Adverse Effect" shall mean any effect on the business, operations, properties, prospects, or financial condition of the Company that is material and adverse to the Company and its subsidiaries and affiliates, taken as a whole, and/or any condition, circumstance, or situation that would prohibit or otherwise interfere with the ability of the Company to enter into and perform any of its obligations under this Agreement, the Registration Rights Agreement or the Escrow Agreement in any material respect.

Section 1.17 "Maximum Put Amount" shall mean the amount indicated by the following table:


Stock Bid Price

15,000-50,000 Avg. 30 Trading Day Volume

50,001-100,000 Avg. 30 Trading Day Volume

100,001-150,000 Avg. 30 Trading Day Volume

150,001-Above Avg. 30 Trading Day Volume

$0.50-1.00   

$400,000

$400,000

$600,000

$600,000

1.00-3.00

$500,000

$500,000

$750,000

$750,000

3.01-4.50

$500,000

$750,000

$750,000

$1,000,000

4.51-6.00

$750,000

$750,000

$1,000,000

$1,000,000

6.01-7.50

$750,000

$1,000,000

$1,000,000

$1,250,000

7.51-9.00

$1,000,000

$1,000,000

$1,250,000

$1,250,000

9.01-Above

$1,000,000

$1,250,000

$1,250,000

$1,500,000

If the Bid Price or the thirty-day average trading volumes shall be less than the parameters set forth in the foregoing table, the Maximum Put Amount shall be $250,000.

Section 1.18 "NASD" shall mean the National Association of Securities Dealers, Inc.

Section 1.19 "Outstanding" when used with reference to shares of Common Stock or Capital Shares (collectively the "Shares"), shall mean, at any date as of which the number of such Shares is to be determined, all issued and outstanding Shares, and shall include all such Shares issuable in respect of outstanding scrip or any certificates representing fractional interests in such Shares; provided, however, that "Outstanding" shall not mean any such Shares then directly or indirectly owned or held by or for the account of the Company.

Section 1.20 "Person" shall mean an individual, a corporation, a partnership, an association, a trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

Section 1.21 "Principal Market" shall mean the NASDAQ National Market, the NASDAQ SmallCap Market, the American Stock Exchange, the New York Stock Exchange or the OTC Bulletin Board, whichever is at the time the principal trading exchange or market for the Common Stock.

Section 1.22 "Purchase Price" shall mean with respect to Put Shares, eight-eight percent (88%) of the Market Price for the Valuation Period applicable to a Put Date (or such other date on which the Purchase Price is calculated in accordance with the terms and conditions of this Agreement).

Section 1.23 "Put" shall mean each occasion the Company elects to exercise its right to tender a Put Notice requiring the Investor to purchase shares of Common Stock, subject to the terms of this Agreement.

Section 1.24 "Put Date" shall mean the Trading Day during the Commitment Period that a Put Notice to sell Common Stock to the Investor is deemed delivered pursuant to Section 2.2(b) hereof.

Section 1.25 "Put Notice" shall mean a written notice to the Investor setting forth the Investment Amount that the Company intends to sell to the Investor in the form attached hereto as Exhibit B.

Section 1.26 "Put Shares" shall mean all shares of Common Stock or other securities issued or issuable pursuant to a Put that has occurred or may occur in accordance with the terms and conditions of this Agreement.

Section 1.27 "Registrable Securities" shall mean the Put Shares and Warrant Shares until (i) all Put Shares and Warrant Shares have been disposed of pursuant to the Registration Statement, (ii) all Put Shares and Warrant Shares have been sold under circumstances under which all of the applicable conditions of Rule 144 (or any similar provision then in force) under the Securities Act ("Rule 144") are met, (iii) all Put Shares and Warrant Shares have been otherwise transferred to persons who may trade such shares without restriction under the Securities Act, and the Company has delivered a new certificate or other evidence of ownership for such securities not bearing a restrictive legend or (iv) such time as, in the opinion of counsel to the Company, all Put Shares and Warrant Shares may be sold without any time, volume or manner limitations pursuant to Rule 144(k) (or any similar provision then in effect) under the Securities Act.

Section 1.28 "Registration Rights Agreement" shall mean the registration rights Agreement between the Company and the Investor in the form of Exhibit D attached hereto.

Section 1.29 "Registration Statement" shall mean the Company's registration statement on Form SB-2, and any subsequent Form SB-2 (if use of such form is then available to the Company pursuant to the rules of the SEC and, if not, on such other form promulgated by the SEC, for which the Company then qualifies and which counsel for the Company shall deem appropriate, and which form shall be available for the resale by the Investor of the Registrable Securities to be registered thereunder in accordance with the provisions of this Agreement, and in accordance with the intended method of distribution of such securities), for the registration of the resale by the Investor of the Registrable Securities under the Securities Act.

Section 1.30 "SEC" shall mean the Securities and Exchange Commission.

Section 1.31 "Securities Act" shall have the meaning set forth in the recitals of this Agreement.

Section 1.32 "SEC Documents" shall mean the Company's latest Form 10-K or 10-KSB as of the time in question, all Forms 10-Q or 10-QSB and 8-K filed thereafter, and the Proxy Statement for its latest fiscal year as of the time in question until such time as the Company no longer has an obligation to maintain the effectiveness of a Registration Statement.

Section 1.33 Trading Cushion" shall mean the mandatory fifteen (15) Trading Days between Put Dates.

Section 1.34 "Trading Day" shall mean any day during which the Principal Market shall be open for business.

Section 1.35 "Valuation Event" shall mean an event in which the Company at any time after the date of this Agreement and prior to the end of the Commitment Period takes any of the following actions:

    1. subdivides or combines its Common Stock;

    2. pays a dividend in its Capital Stock or makes any other distribution of its Capital Shares;

    3. issues any additional Capital Shares ("Additional Capital Shares"), otherwise than as provided in the foregoing Subsections (a) and (b) above or (d) and (e) below, at a price per share less, or for other consideration lower, than the Bid Price in effect immediately prior to such issuance, or without consideration (other than pursuant to this Agreement);

    4. issues any warrants, options or other rights to subscribe for or purchase any Additional Capital Shares and the price per share for which Additional Capital Shares may at any time thereafter be issuable pursuant to such warrants, options or other rights shall be less than the Bid Price in effect immediately prior to such issuance;

    5. issues any securities convertible into or exchangeable for Capital Shares and the consideration per share for which Additional Capital Shares may at any time thereafter be issuable pursuant to the terms of such convertible or exchangeable securities shall be less than the Bid Price in effect immediately prior to such issuance;

    6. makes a distribution of its assets or evidences of indebtedness to the holders of its Capital Shares as a dividend in liquidation or by way of return of capital or other than as a dividend payable out of earnings or surplus legally available for dividends under applicable law or any distribution to such holders made in respect of the sale of all or substantially all of the Company's assets (other than under the circumstances provided for in the foregoing subsections (a) through (e); or

    7. takes any action affecting the number of Outstanding Capital Shares, other than an action described in any of the foregoing Subsections (a) through (f) hereof, inclusive, which in the opinion of the Company's Board of Directors, determined in good faith, would have a Material Adverse Effect upon the rights of the Investor at the time of a Put.

    Section 1.36 "Valuation Period" shall mean the period of nine (9) Trading Days during which the Purchase Price of the Common Stock is valued, which period shall be with respect to the Purchase Price on any Put Date, the two (2) Trading Days immediately preceding and the six (6) Trading Days following the Trading Day on which a Put Notice is deemed to be delivered, as well as the Trading Day on which such notice is deemed to be delivered; provided, however, that if a Valuation Event occurs during a Valuation Period, a new Valuation Period shall begin on the Trading Day immediately after the occurrence of such Valuation Event and end on the sixth Trading Day thereafter.


     

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