Exhibit 10.2

 
UNIT PURCHASE AGREEMENT
 
BY AND AMONG
 
MEDOVEX CORPORATION

AND

THE PURCHASERS PARTY HERETO

 

 
 

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EXHIBITS
TO
UNIT PURCHASE AGREEMENT
 
Exhibit A                                Schedule of Purchasers
Exhibit B                                Form of Warrant
Exhibit C                                Form of Registration Rights Agreement
Exhibit D                                Risk Factors
 
 
 

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MEDOVEX CORPORATION
 
UNIT PURCHASE AGREEMENT
 
THIS UNIT PURCHASE AGREEMENT (the “Agreement”) is entered into as of the date
set forth on the signature page hereto by and among Medovex Corporation, a
Nevada corporation (the “Company”), and the purchasers identified on Exhibit A
on the date hereof (which purchasers are hereinafter collectively referred to as
the “Purchasers” and each individually as, a “Purchaser”).
 
BACKGROUND
 
A.           Unless otherwise defined in this Agreement, capitalized terms used
in this Agreement shall have the respective meanings ascribed to such terms in
Section ‎9.
 
B.           The Company is offering (the “Offering”) Units to a limited number
of persons who qualify as “accredited investors” as defined in Rule 501 of
Regulation D promulgated under the Securities Act at a price per Unit of
$250,000 pursuant to the terms set forth in the Subscription Agreement..

C.           The Company is offering to a limited number of persons who qualify
as “accredited investors” as defined in Rule 501 of Regulation D promulgated
under the Securities Act (the “Offering”) units of the common stock, par value,
$0.001 per share, of the Company (the “Common Stock”) and warrants to purchase
shares of Common Stock (collectively, the “Units”) at a price per Unit of
$250,000.

D.           Each Unit shall consist of (a) 208,333 shares of Common Stock at a
price of $1.20 per share, and (b) a warrant to purchase 104,167 shares of Common
Stock at an exercise price per share equal to $1.52 per share, which warrant
will be exercisable six months from the date of issuance for a period of five
(5) years following the final closing (the “Final Closing Date”) of the Offering
(the “Warrant”).

E.           The Units are being offered on a “reasonable efforts, all or none”
basis with respect to the minimum of $250,000 (the “Minimum Offering Amount”),
and thereafter on a “reasonable efforts” basis up to the maximum of
$1,300,000 (the “Maximum Offering Amount”); provided, that, the Company may
determine, prior to the “Termination Date” referred to below, to terminate the
Offering if a total of $1,300,000 of Units has been sold.

F.           The Company desires to issue and sell the Units to each Purchaser
in one or more closings (each a “Closing” and collectively the “Closings”) as
set forth herein.
 
NOW, THEREFORE, in consideration of the representations, warranties, covenants
and agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties, intending
to be legally bound, hereby agree as follows:
 
1. AGREEMENT TO SELL AND PURCHASE.
 
1.1 Authorization of Units.   The board of directors of the Company (the “Board
of Directors”) has authorized (i) the sale of up to 5.2 Units, each Unit
consisting of (a) 208,333 shares of Common Stock and (b) a warrant to purchase
104,167 shares of Common Stock at an exercise price per share equal to $1.52,
which warrant will be exercisable six months from the date of issuance for a
period of five (5) years following the final Closing.  From and after the
applicable Closing, the Company shall issue and reserve for issuance the shares
of its Common Stock issuable in such Closing; and (ii) the shares of Common
Stock that may be issued upon full exercise of the Warrants (the “Warrant
Shares”) issued at such Closing, plus such additional number of Warrant Shares
as shall be required to be issued pursuant to the terms thereof.
 
1.2 Initial Sale and Purchase of Units.  Subject to the terms and conditions
hereof, and in reliance upon the representations, warranties and covenants
contained herein, at the Initial Closing, the Company shall issue and sell to
each Purchaser, and each Purchaser shall purchase from the Company, the number
of Units set forth opposite such Purchaser’s name on Exhibit A under the
“Initial Units” column, at a purchase price of $250,000 per Unit (subject to
appropriate and proportionate adjustment for stock dividends payable in shares
of, forward or reverse stock splits and other subdivisions and combinations of,
and recapitalizations and like occurrences with respect to, the Common Stock,
the “Per Unit Purchase Price”).  The minimum purchase by each Purchaser is one
Unit, unless the Company agrees, to allow a Purchaser to purchase a partial
Unit.
 
 
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1.3 Subsequent Sales and Purchases of Units.  Subject to the terms and
conditions hereof, and in reliance upon the representations, warranties and
covenants contained herein, at each subsequent Closing, the Company shall issue
and sell to each Purchaser who is identified as a “Subsequent Closing Purchaser”
on Exhibit A, which shall be deemed amended at each such subsequent Closing to
add each such additional Purchaser (each, a “Subsequent Closing Purchaser”), and
each Subsequent Closing Purchaser shall purchase from the Company, the number of
Units set forth opposite such Purchaser’s name on Exhibit A at the Per Unit
Purchase Price.
 
1.4 Issuance of Warrants.  The Warrants shall be in form and substance
substantially the same as the form of Warrant in Exhibit B.
 
2. CLOSINGS, DELIVERY AND PAYMENT.
 
2.1 Initial Closing.  Subject to the conditions set forth in Section 5 herein,
the initial closing of the sale and purchase of the Units (the “Initial
Closing”), shall take place electronically on such date and at such time as the
Company determines (such date the “Initial Closing Date”); upon the earliest of
(1) the sale of the Maximum Offering Amount or (2) August  30, 2016 (the
“Termination Date”), which Termination Date may be extended by the Company in
their joint discretion, without notice or vote by prospective investors, to a
date no later than October 31, 2016 (the “Final Termination Date”).  Subject to
the foregoing, at the Initial Closing, the Company must sell the minimum of one
full Unit for $250,000 (the “Initial Unit”), and the Company may thereafter sell
up to a maximum of 5.2 Units.
 
2.2 Subsequent Closings.  If the Minimum Offering Amount has been raised prior
to the Final Termination Date, subject to the conditions set forth in Section 5,
each Subsequent Closing shall take place electronically on such date and at such
time as is determined by the Company (such date the “Subsequent Closing Date”),
in no event later than the Final Termination Date.   Subject to the foregoing,
at Subsequent Closings, the Company may sell up to a maximum of 5.2 Units less
the number of Units sold in all prior Closings.  The Units sold at the
Subsequent Closings are sometimes referred to herein as “Subsequent Units.”
 
2.3 Delivery; Payment.  At each Closing, subject to the terms and conditions
hereof, the Purchasers will deliver the full amount of the Purchase Price in
cash by wire transfer of immediately available funds in accordance with
instructions included herein, or as the Company shall otherwise direct and the
Company will deliver (1) one (1) certificate registered in such Purchaser’s name
for such number of shares of Common Stock included in the Units purchased by
such Purchaser or Subsequent Closing Purchaser, as the case may be, at such
Closing and (2)  one Warrant, registered in such Purchaser’s name to purchase
such number of Warrant Shares included in the Units purchased by such Purchaser
or Subsequent Closing Purchaser, as the case may be, at such Closing.  The
Company in its sole discretion, may allow a Purchaser to purchase a partial
Unit, in which case the Purchaser shall receive a certificate representing the
appropriate number of shares of Common Stock included in such partial Unit and a
Warrant for the appropriate number of corresponding Warrant Shares.
 
3.  
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

 
The Company represents and warrants to each of the Purchasers that the
statements made in this Section 3, except as qualified in the disclosure
schedules referenced herein and attached hereto (the “Schedules”), are true and
correct on the date hereof, as of the Initial Closing and shall be true and
correct as of each Subsequent Closing, except as qualified by any updated
Schedules delivered at the Subsequent Closing, in accordance with Section ‎5.1.1
herein, all of which qualifications in the Schedules attached hereto and updated
Schedules delivered at the Subsequent Closing shall be deemed to be
representations and warranties as if made hereunder.  The Schedules shall be
arranged to correspond to the numbered paragraphs contained in this Section 3,
and the disclosure in any paragraph of the Schedules shall qualify other
subsections in Section 3 only to the extent that it is readily apparent from a
reading of the disclosure that such disclosure is applicable to such other
subsections.  For purposes of this Section 3, “knowledge” shall mean the
personal knowledge of any of the Company’s officers or directors or what they
would have known upon having made reasonable inquiry.
 
3.1 Organization, Good Standing and Qualification.  The Company is a corporation
duly incorporated, validly existing and in good standing under the corporate and
general laws of the State of Nevada.  Each of the Subsidiaries is a corporation
duly incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation.  Each of the Company and its Subsidiaries has all
requisite corporate power and authority to own and operate its properties and
assets.  Neither the Company nor any Subsidiary is in violation nor default of
any of the provisions of its respective certificate or articles of
incorporation, bylaws or other organizational or charter documents.  Each of the
Company and its Subsidiaries is duly qualified to conduct business and is in
good standing as a foreign corporation in each jurisdiction set forth on
Schedule ‎3.1, except where failure to be so qualified or in good standing, as
the case may be, could not reasonably be expected to result in: (i) a material
adverse effect on the legality, validity or enforceability of any Transaction
Document, (ii) a material adverse effect on the results of operations, assets,
business, prospects or condition (financial or otherwise) of the Company and its
Subsidiaries, taken as a whole, or (iii) a material adverse effect on the
Company’s ability to perform in any material respect on a timely basis its
obligations under any Transaction Document (any of (i), (ii) or (iii), a
“Material Adverse Effect”) and no Proceeding has been instituted in any such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.
 
 
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3.2 Subsidiaries.  The SEC Reports include a true and complete list of each of
the Subsidiaries and their respective jurisdictions of organization.  Except as
set forth on Schedule ‎3.2, neither the Company nor any Subsidiary owns or
controls any ownership interest or profits interest in any other corporation,
limited liability company, limited partnership or other entity.  The Company
owns, directly or indirectly, all of the capital stock or other equity interests
of each Subsidiary free and clear of any Liens, and all of 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 to
subscribe for or purchase securities.
 
3.3 Authorization; Enforcement.  The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by
this Agreement and each of the other Transaction Documents and otherwise to
carry out its obligations hereunder and thereunder.  The execution and delivery
of this Agreement and each of the other Transaction Documents by the Company and
the consummation by it of the transactions contemplated hereby and thereby have
been duly authorized by all necessary action on the part of the Company and no
further action is required by the Company, the Board of Directors or the
Company’s stockholders in connection herewith or therewith other than in
connection with the required approvals.  This Agreement and each other
Transaction Document to which it is a party has been (or upon delivery will have
been) duly executed by the Company and, when delivered in accordance with the
terms hereof and thereof, will constitute the valid and binding obligation of
the Company enforceable against the Company in accordance with its terms,
except: (i) as limited by general equitable principles and applicable
bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable law.
 
3.4 No Conflicts.  The execution, delivery and performance by the Company of
this Agreement and the other Transaction Documents to which it is a party, the
issuance and sale of the Securities and the consummation by it of the
transactions contemplated hereby and thereby do not and will not: (i) conflict
with or violate any provision of the Company’s or any Subsidiary’s certificate
or articles of incorporation, bylaws or other organizational or charter
documents, (ii) conflict with, or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, result in the
creation of any lien upon any of the properties or assets of the Company or any
Subsidiary, or give to others any rights of termination, amendment, acceleration
or cancellation (with or without notice, lapse of time or both) of, any
agreement, credit facility, debt or other instrument (evidencing a Company or
Subsidiary debt or otherwise) or other understanding to which the Company or any
Subsidiary is a party or by which any property or asset of the Company or any
Subsidiary is bound or affected, or (iii) conflict with or result in a violation
of any law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Company or a
Subsidiary is subject (including federal and state securities laws and
regulations), or by which any property or asset of the Company or a Subsidiary
is bound or affected; except in the case of each of clauses (ii) and (iii), such
as could not have or reasonably be expected to result in a Material Adverse
Effect.

3.5 Filings, Consents and Approvals.  Except for NASDAQ approval, the Company is
not required to obtain any consent, waiver, authorization or order of, give any
notice to, or make any filing or registration with, any court or other federal,
state, local or other governmental authority or other Person in connection with
the execution, delivery and performance by the Company of the Transaction
Documents.

3.6 Issuance of the Securities.  The Units, the shares of Common Stock and the
Warrants are duly authorized and, when issued and paid for in accordance with
the applicable Transaction Documents, will be duly and validly issued, fully
paid and nonassessable, free and clear of all liens imposed by the Company other
than restrictions on transfer provided for in the Transaction Documents.  The
Warrant Shares, when issued in accordance with the terms of the Warrants, will
be validly issued, fully paid and nonassessable, free and clear of all liens
imposed by the Company other than restrictions on transfer provided for in the
Transaction Documents.  The Company has reserved from its duly authorized
capital stock a number of shares of Common Stock for issuance of the Warrant
Shares  on the date hereof.

3.7 Capitalization.  The capitalization of the Company is as set forth in
Schedule 3.7 hereto.  Except as disclosed on the SEC Reports, there are no
outstanding securities of the Company or any Subsidiary which contain any right
of first refusal, preemptive right, right of participation, or any similar
right. No Person has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the transactions
contemplated by the Transaction Documents.  Except as a result of the purchase
and sale of the Securities, and except as set forth in the SEC Reports, there
are no outstanding options, warrants, scrip rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities, rights or
obligations convertible into or exercisable or exchangeable for, or giving any
Person any right to subscribe for or acquire any shares of Common Stock, or
contracts, commitments, understandings or arrangements by which the Company or
any Subsidiary is or may become bound to issue additional shares of Common Stock
or common stock equivalents. The issuance and sale of the Securities will not
obligate the Company to issue shares of Common Stock or other securities to any
Person (other than the Purchasers) and will not result in a right of any holder
of Company securities to adjust the exercise, conversion, exchange or reset
price under any of such securities. There are no proxies, stockholder
agreements, or any other agreements between the Company or any Subsidiary and
any securityholder of such entity or, to the knowledge of the Company, among any
securityholders of the Company or any Subsidiary, including agreements relating
to the voting, transfer, redemption or repurchase of any securities of such
entity.  Neither the Company nor any Subsidiary has any outstanding shareholder
purchase rights or “poison pill” or any similar arrangement in effect giving any
person the right to purchase any equity interest in such entity upon the
occurrence of certain events. All of the outstanding shares of capital stock of
the Company are duly authorized, validly issued, fully paid and nonassessable,
have been issued in compliance with all federal and state securities laws, and
none of such outstanding shares was issued in violation of any preemptive rights
or similar rights to subscribe for or purchase securities.  No further approval
or authorization of any stockholder, the Board of Directors or others is
required for the issuance and sale of the Securities.  There are no stockholders
agreements, voting agreements or other similar agreements with respect to the
Company’s capital stock to which the Company is a party or, to the knowledge of
the Company, between or among any of the Company’s stockholders. Except as
required by law, including any federal securities rules and regulations, there
are no restrictions upon the voting or transfer of any of the shares of capital
stock of the Company or any Subsidiary pursuant to its organizational documents
or other governing documents or any agreement or other instruments to which the
Company or any Subsidiary is a party or by which it is bound.

 
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3.8 Shell Company Status; SEC Reports; Financial Statements.   The Company was
never a “shell” company as described in Rule 144(i)(1) under the Securities Act.
The Company has filed all reports, schedules, forms, statements and other
documents required to be filed by it under the Securities Exchange Act ,
including pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company was required by
law or regulation to file such material) (the foregoing materials and any
amendments filed through the date hereof, including the exhibits thereto and
documents incorporated by reference therein, being collectively referred to
herein as the “SEC Reports”) on a timely basis or has received a valid extension
of such time of filing and has filed any such SEC Reports prior to the
expiration of any such extension.  As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Securities Act
and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
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 not misleading. The financial statements of the Company included in the
SEC Reports comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with respect
thereto as in effect at the time of filing.   The financial statements (the
“Financial Statements”) of the Company included in SEC Reports been prepared in
accordance with United States generally accepted accounting principles applied
on a consistent basis during the periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the footnotes thereto except
that  unaudited financial statements may not contain all footnotes required by
GAAP, and fairly present in all material respects the financial position of the
Company and its Subsidiaries as of and for the dates thereof and the results of
operations and cash flows for the periods then ended, subject to normal,
immaterial, year-end audit adjustments. There is no transaction, arrangement, or
other relationship between the Company or any Subsidiary and an unconsolidated
or other off balance sheet entity that is not disclosed in its financial
statements that should be disclosed in accordance with GAAP and that would be
reasonably likely to have a material adverse effect.
 
3.9 Absence of Liabilities.  Except as set forth in the SEC Reports or on
Schedule 3.9 hereto,  since the Balance Sheet Date (hereinafter defined): (i)
there has been no event, occurrence or development that has had or that could
reasonably be expected to result in a Material Adverse Effect, (ii) the Company
has not incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business
consistent with past practice and (B) liabilities not required to be reflected
in the Company’s financial statements pursuant to GAAP or disclosed in filings
made with the Commission, (iii) the Company has not altered its method of
accounting, (iv) the Company has not declared or made any dividend or
distribution of cash or other property to its stockholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital
stock and (v) the Company has not issued any equity securities to any officer,
director or Affiliate, except pursuant to existing Company stock option plans.
Except for the issuance of the Securities contemplated by this Agreement or as
set forth in the SEC Reports no event, liability, fact, circumstance, occurrence
or development has occurred or exists or is reasonably expected to occur or
exist with respect to the Company or its Subsidiaries or their respective
businesses, properties, operations, assets or financial condition, that would be
required to be disclosed by the Company under applicable securities laws at the
time this representation is made or deemed made. Except as set forth in the SEC
Reports or on Schedule 3.9, neither the Company nor any Subsidiary is a
guarantor or indemnitor of any liability of any other Person.
 
For purposes of this Section 3.9, March 31, 2016 is referred to as the “Balance
Sheet Date”.
 
3.10 Agreements; Action.
 
3.10.1. Disclosure.  Except as set forth on Schedule 3.10.1 , the SEC Reports
include exhibits consisting of all of the following Contracts to which the
Company and its Subsidiaries or any of their respective properties or assets are
a party or otherwise bound (each a “Material Contract”):
 
(a) Contracts not made in the ordinary course of business;
 
(b) each Contract pursuant to which (x) the Company or any Subsidiary is granted
rights to, or ownership in, any Intellectual Property (as defined below) by any
other Person (excluding “shrink wrap” licenses for generally available,
commercial, off-the-shelf Software that has not been modified), (y) the Company
or any Subsidiary purchases components, raw materials, equipment, instruments,
and other supplies and machinery that are material to the Company’s or any
Subsidiary’s businesses, or supplies any other Person with any components, raw
materials, equipment, instruments, and other supplies and machinery, or (z) the
Company or any Subsidiary grants another person rights to, or ownership in, any
Intellectual Property;
 
(c) Contracts relating to the manufacture or production of any of the Products;
 
(d) Contracts among one or more stockholders of the Company or any Subsidiary
which by their respective terms require performance after the date hereof;
 
 
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(e) Contracts or commitments involving future expenditures, actual or potential,
in excess of $150,000 after the date hereof;
 
(f) Contracts or commitments for the performance of services for the Company or
any Subsidiary by a third party which has a term of one (1) year or more and
involves expenditures by the Company or any Subsidiary of $150,000 or more;
 
(g) Contracts or commitments relating to commission arrangements with any other
Person;
 
(h) Contracts (A) to employ, engage or terminate executive officers and other
Contracts with present or former executive officers or directors of the Company
which by their respective terms require performance after the date hereof, or
(B) that will result in the payment of, or the creation of any Liability on the
part of the Company or any Subsidiary to pay, any severance, termination,
“golden parachute,” or other similar payments to any present or former executive
officers or directors of the Company or any Subsidiary following termination of
employment or engagement or otherwise;
 
(i) any lease under which any Subsidiary is either lessor or lessee of personal
property requiring annual lease payments (including rent and any other charges)
in excess of $150,000, and any lease under which any Subsidiary is either lessor
or lessee of any real property, including any Real Property Lease;
 
(j) promissory notes, loans, agreements, indentures, evidences of indebtedness,
letters of credit, guarantees, or other instruments relating to an obligation to
pay in excess of $150,000, whether the Company or any Subsidiary shall be the
borrower, lender or guarantor thereunder (excluding credit provided by the
Company or any Subsidiary in the ordinary course of business to purchasers of
its products or services and obligations to pay vendors in the ordinary course
of business and consistent with past practice);
 
(k) Contracts containing covenants limiting the freedom of the Company or any
Subsidiary to engage in any activity anywhere in the world;
 
(l) Contracts between the Company or any Subsidiary and any United States
federal, state or local government or any foreign government, or any
Governmental or Regulatory Authority, or any agency or department thereof, or
with any educational institution or part thereof;
 
(m) any power of attorney granted by the Company or any Subsidiary in favor of
any Person;
 
(n) Contracts pertaining to any material joint ventures, partnerships or similar
arrangements;
 
(o) any Contract or other arrangement with an Affiliate; and
 
(p) any Contract not otherwise required to be listed pursuant to Subsections (a)
– (p) above and with respect to which the consequences of a default, non-renewal
or termination could reasonably be expected to have a Material Adverse Effect in
the absence of a replacement Contract or arrangement therefor.
 
3.10.2. The Company has provided or made available, either through access to the
SEC Reports or otherwise upon request, true and complete copies, of all of the
Material Contracts to the Purchasers.  Each of the Material Contracts is (a) in
full force and effect, (b) a valid and binding obligation of, and is enforceable
in accordance with its terms against the Company or the applicable Subsidiary
that is party thereto and, to the knowledge of the Company, each of the other
parties thereto, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium or other law affecting the enforcement of creditors’
rights generally or by general equitable principles, (c) except for those
Material Contracts disclosed pursuant to Section 3.10.1(a) and identified as
such, was made in the ordinary course of business, and (d) contains no provision
or covenant prohibiting or limiting the ability of the Company or any Subsidiary
to operate its business in the manner in which it is currently operated.
 
 
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3.10.3. To the best of the Company’s knowledge, each of the Company and its
Subsidiaries has in all material respects performed the obligations required to
be performed by it to date under each Material Contract to which it is a party
and is not in default or breach thereof, and no event or condition has occurred,
whether with or without the passage of time or the giving of notice, or both,
that would constitute such a breach or default.  Neither the Company nor any
Subsidiary or any other party to any Material Contract has provided any notice
to the other party or to the Company or any Subsidiary, as applicable, of its
intent to terminate, withdraw its participation in, or not renew any such
Material Contract.  Neither the Company nor its Subsidiaries has, and to the
knowledge of the Company, no other party to any Material Contract has,
threatened to terminate, withdraw from participation in, or not renew any such
Material Contract.  To the knowledge of the Company, no other party to any
Material Contract is in breach or default under any provision thereof, and no
event or condition has occurred, whether with or without the passage of time or
the giving of notice, or both, that would constitute such a breach or default.
 
3.10.4. No Consent of any party to any Material Contract is required in
connection with the transactions contemplated by this Agreement and the other
Transaction Documents.
 
3.10.5. The execution, delivery and performance of this Agreement and the other
Transaction Documents do not and will not (a) result in or give to any Person
any right of termination, non-renewal, cancellation, withdrawal, acceleration or
modification in or with respect to any Material Contract, (b) result in or give
to any Person any additional rights or entitlement to increased, additional,
accelerated or guaranteed payments under any such Material Contract or (c)
result in the creation or imposition of any Liability or any Encumbrances upon
the Intellectual Property or any assets of the Company or any Subsidiary under
the terms of any such Material Contract.
 
3.10.6. Except as disclosed in the SEC Reports, neither the Company nor any
Subsidiary or any representative thereof is a party to any binding Contract or
has engaged in the past twelve (12) months in any discussions regarding, and is
not a party to or otherwise bound by any Contract in respect of, (a) any
purchase, lease, license or other acquisition of any other Person, whether by
equity purchase, merger, consolidation, reorganization or otherwise, or all or
substantially all of the assets of any other Person, or the entering into by the
Company or any Subsidiary of any share exchange with any other Person, (b) any
change of control transaction with respect to the Company or its Subsidiaries,
or (c) liquidation with respect to the Company or any Subsidiary.
 
3.11 Changes.  Except as set forth on Schedule 3.11, or as disclosed in the SEC
Reports, or where the occurrence of any of the following events would not have a
Material Adverse Effect, since December 31, 2015 there has not been:
 
3.11.1. any effect, event, condition or circumstance (including, without
limitation, the initiation of any litigation or other legal, regulatory or
investigative proceeding) against the Company that individually or in the
aggregate, with or without the passage of time, the giving of notice, or both,
has had or could reasonably be expected to have a Material Adverse Effect;
 
3.11.2. any resignation or termination of any director, officer or key employee
of the Company or any Subsidiary, and neither the Company nor any Subsidiary has
received notification of any impending resignation from any such Person;
 
3.11.3. any material change in the contingent obligations of the Company or any
Subsidiary by way of guaranty, endorsement, indemnity, warranty or otherwise;
 
3.11.4. any material damage, destruction or loss adversely affecting the assets,
properties, business, financial condition or prospects of the Company and its
Subsidiaries taken as a whole, whether or not covered by insurance;

3.11.5. any waiver by the Company or any Subsidiary of a valuable right or of
any debt;

3.11.6. any development, event, change, condition or circumstance that
constitutes, whether with or without the passage of time or the giving of notice
or both, a default under any outstanding debt obligation of the Company or any
Subsidiary;
 

3.11.7. any change in any compensation arrangement or agreement with any
employee, consultant, officer, director or stockholder of the Company or any
Subsidiary that would increase the cost of any such agreement or arrangement to
the Company or any Subsidiary by more than $10,000 in each instance;
 
 
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3.11.8. any labor organization activity of the employees of the Company or any
Subsidiary;
 
3.11.9. any declaration or payment of any dividend or other distribution of the
assets of the Company or any Subsidiary;
 
3.11.10. any change in the accounting methods or practices followed by the
Company or any Subsidiary; or
 
3.11.11. any Contract or commitment made by the Company or any Subsidiary to do
any of the foregoing.
 
3.12 Title to Properties and Assets; Liens, etc.  Except where a violation of
this Section 3.12 could not reasonably be expected to have a Material Adverse
Effect, the Company and each Subsidiary has good and marketable title to the
properties and assets it owns, and the Company and each Subsidiary has a valid
license in all properties and assets licensed by it, including the properties
and assets reflected as owned in the most recent balance sheet included in the
Financial Statements, and has a valid leasehold interest in its leasehold
estates, in each case subject to no encumbrance, other than those resulting from
taxes which have not yet become delinquent or those of the lessors of leased
property or assets. All facilities, machinery, equipment, fixtures, vehicles and
other properties owned, leased or used by the Company or any Subsidiary are in
good operating condition and repair, ordinary wear and tear excepted and are fit
and usable for the purposes for which they are being used.  Each of the Company
and its Subsidiaries is in compliance with all terms of each lease to which it
is a party or is otherwise bound.
 
3.13 Intellectual Property.
 
3.13.1. The Company or the applicable Subsidiary is the owner or licensee of all
intellectual property and all Licensed Intellectual Property as described in the
SEC Documents (collectively, the “Intellectual Property”).  Neither the Company
nor any Subsidiary has licensed any Intellectual Property to any Person. All of
the registrations and applications for registration of the Intellectual Property
are valid, subsisting and in full force and effect, and all actions and payments
necessary for the maintenance and continuation of such Intellectual Property
have been taken or paid on a timely basis.  The Company and its Subsidiaries
owns or possesses sufficient legal rights to use all of the Intellectual
Property and the exclusive right to use all Owned Intellectual Property and all
Licensed Intellectual Property as being licensed to the Company and its
Subsidiaries.
 
3.13.2. To the knowledge of the Company, the business as currently conducted and
as proposed to be conducted by the Company and its Subsidiaries has not and will
not constitute any infringement of the Intellectual Property rights of any other
Person which could reasonably be expected to have a Material Adverse Effect.  To
the knowledge of the Company, the development of Product candidates and the use,
manufacture or sale of the Company’s Products based on the Intellectual Property
does not, and will not, infringe the Intellectual Property rights of any third
Person.  To the knowledge of the Company, no employee or agents of the Company
or any Subsidiary have misappropriated the Intellectual Property rights of any
Person.
 
3.13.3. There are no outstanding options or other rights to acquire any
Intellectual Property.  To the knowledge of the Company, each licensor of the
Licensed Intellectual Property is the sole and exclusive owner of such Licensed
Intellectual Property and has the sole and exclusive right and authority to
grant licenses to such Licensed Intellectual Property.
 
3.13.4. The Company nor any Subsidiary has received any written communications
alleging or suggesting that it has violated or, by conducting its business as
currently conducted or proposed to be conducted, would infringe or
misappropriate any of the Intellectual Property rights of any other Person.
 
3.13.5. It is not necessary to the business of the Company or any Subsidiary, as
currently conducted or as proposed to be conducted, to utilize any inventions,
trade secrets or proprietary information of any of its employees, agents,
developers, consultants or contractors made prior to their employment by or
service to such entity, except for inventions, trade secrets or proprietary
information that have been assigned or licensed to the Company or any
Subsidiary.

3.13.6. Except as disclosed in the SEC Reports, since the date of the Company’s
incorporation, there has not been any sale, assignment or transfer of any
material Intellectual Property or other material intangible assets of the
Company by the Company or any Subsidiary.
 
3.13.7. To the knowledge of the Company, no Intellectual Property is subject to
any interference, reissue, reexamination, opposition or cancellation proceeding
or any other Legal Proceeding or subject to or otherwise bound by any
outstanding Order or Contract (other than in the case of any Licensed
Intellectual Property, the Contract pursuant to which the Company licenses the
rights to such Licensed Intellectual Property) that restricts in any manner the
use, transfer or licensing thereof by the Company or any Subsidiary or may
affect the validity, use or enforceability of such Intellectual Property.
Neither the Company nor any Subsidiary has any knowledge of any fact or
circumstance that would render any portion of the Intellectual Property invalid
or unenforceable.
 
 
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3.13.8. Except where the failure to comply with this Section 3.13.8 could not be
reasonably expected to have a Material Adverse Effect, each current and former
officer, employee, agent, developer, consultant and contractor who (a) has had
or has access to any confidentiality of the trade secrets of the Intellectual
Property; and (b) contributed to or participated in the creation and/or
development of the Intellectual Property either: (i) is a party to a “work made
for hire” agreement under which the Company or any Subsidiary is deemed to be
the original owner/author of all right, title and interest in the Intellectual
Property created or developed by such Person; or (ii) has executed an assignment
or an agreement to assign in favor of the Company or any Subsidiary of all such
Person’s right, title and interest in the Intellectual Property.

3.13.9. The execution and delivery of this Agreement and the other Transaction
Documents and consummation of the transactions contemplated hereby and thereby
will not result in the breach of, or create on behalf of any third party the
right to terminate or modify, any license, sublicense, agreement or permission:
(a) relating to or affecting any Intellectual Property; or (b) pursuant to which
the Company or any Subsidiary is granted a license or otherwise authorized to
use any third party Intellectual Property.

3.13.10.  Except as set forth in the SEC Reports, to the knowledge of the
Company, no Person is infringing, violating, misappropriating or making
unauthorized use of any of the Intellectual Property. Neither the Company nor
any Subsidiary have enforced and taken such commercially reasonable steps as are
necessary to protect and preserve all rights in the Intellectual Property
against the infringement, violation, misappropriation and unauthorized use
thereof by any Person.  Each of the Company or the Subsidiary has the right to:
(a) bring actions for past, present and future infringement, dilution,
misappropriation or unauthorized use of any Intellectual Property owned or
licensed by such entity, injury to goodwill associated with the use of any such
Intellectual Property, unfair competition or trade practices violations of and
other violation of such Intellectual Property; and (b) with respect to
the  Intellectual Property owned exclusively by the Company or any Subsidiary,
receive all proceeds from the foregoing set forth in subsection (a) hereof,
including, without limitation, licenses, royalties income, payments, claims,
damages and proceeds of suit.
 
3.14 Compliance with Other Instruments.  Except as set forth in the SEC Reports
or on Schedule 3.14, neither the Company nor any Subsidiary (i) is in default
under or in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a default by the
Company or any Subsidiary under), nor has the Company or any Subsidiary received
notice of a claim that it is in default under or that it is in violation of, any
indenture, loan or credit agreement or any other agreement or instrument to
which it is a party or by which it or any of its properties is bound (whether or
not such default or violation has been waived), (ii) is in violation of any
judgment, decree or order of any court, arbitrator or other governmental
authority or (iii) is or has been in violation of any statute, rule, ordinance
or regulation of any governmental authority, including without limitation all
foreign, federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and safety and
employment and labor matters, except in each case as could not have or
reasonably be expected to result in a Material Adverse Effect.
 
3.15 Litigation.  Except as set forth in the SEC Reports,  there is no Legal
Proceeding pending or, to the knowledge of the Company, threatened against the
Company or any Subsidiary or any investigation of the Company or any Subsidiary,
nor is the Company aware of any fact that would make any of the foregoing
reasonably likely to arise. Neither the Company nor any Subsidiary is a party or
subject to the provisions of any Order. Except as set forth in the SEC Reports,
there is no Legal Proceeding by the Company or any Subsidiary currently pending
or that the Company or any Subsidiary intends to initiate. Neither the Company
nor any Subsidiary, nor any director or officer thereof, is or has been the
subject of any Order involving a claim of violation of or liability under
federal or state securities laws or a claim of breach of fiduciary duty.  There
has not been, and to the knowledge of the Company, there is not pending or
contemplated, any investigation by the Commission involving the Company or any
current or former director or officer of the Company.
 
3.16 Tax Returns and Payments.
 
3.16.1. Except as set forth in the SEC Reports, the Company and each Subsidiary
has filed all Tax Returns required to be filed by it, and each such entity has
timely paid all Taxes owed (whether or not shown on any Tax Return).  All such
Tax Returns were complete and correct, and such Tax Returns correctly reflected
the facts regarding the income, business, assets, operations, activities, status
and other matters of such entity and any other information required to be shown
thereon. The Company and each Subsidiary has withheld and paid all Taxes
required to have been withheld and paid in connection with amounts paid or owing
to any Employee, creditor, independent contractor, shareholder, member or other
third party.  The Company and each Subsidiary has established adequate reserves
for all Taxes accrued but not yet payable. No deficiency assessment with respect
to or proposed adjustment of the Company and/or any Subsidiaries Taxes is
pending or, to the knowledge of the Company, threatened.  There is no tax lien
(other than for current Taxes not yet due and payable), imposed by any taxing
authority, outstanding against the assets, properties or the business of the
Company or any Subsidiary.
 
 
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3.16.2. Neither the Company nor any Subsidiary has agreed to make any adjustment
under Section 481(a) of the Internal Revenue Code of 1986, as amended (the
“Code”) (or any corresponding provision of state, local or foreign tax law) by
reason of a change in accounting method or otherwise, and neither the Company
nor any Subsidiary will be required to make any such adjustment as a result of
the transactions contemplated by this Agreement.  Neither the Company nor any
Subsidiary has been or is a party to any tax sharing or similar agreement.
Neither the Company nor any Subsidiary is or has ever been a party to any joint
venture, partnership, limited liability company, or other arrangement or
Contract which could be treated as a partnership for federal income tax
purposes.  Neither the Company nor any Subsidiary is or has ever been a “United
States real property holding corporation” as that term is defined in Section 897
of the Code.
 
3.17 Employees.
 
3.17.1. (a) Neither the Company nor any Subsidiary has, or has ever had any,
collective bargaining agreements with any of its employees; (b) there is no
labor union organizing activity pending or, to the knowledge of the Company,
threatened with respect to the Company or any Subsidiary; (c) no employee has or
is subject to any agreement or Contract to which the Company or any Subsidiary
is a party (including, without limitation, licenses, covenants or commitments of
any nature) regarding his or her employment or engagement; (d) to the best of
the Company’s knowledge, no employee is subject to any Order that would
interfere with his or her duties to the Company or any Subsidiary or that would
conflict with the businesses the Company or any Subsidiary as currently
conducted and as proposed to be conducted; (e) no employee is in violation of
any term of any employment contract, proprietary information agreement or any
other agreement relating to the right of any such Person to be employed by, or
to contract with, the Company or any Subsidiary; (f) to the best of the
Company’s knowledge, the continued employment by the Company or any Subsidiary
of its present employees, and the performance of their respective duties to such
entity, will not result in any violation of any term of any employment contract,
proprietary information agreement or any other agreement relating to the right
of any such individual to be employed by, or to contract with, the Company or
any Subsidiary, and neither the Company nor any Subsidiary has received any
written notice alleging that such violation has occurred; (g) no Employee or
consultant has been granted the right to continued employment by or service to
the Company or any Subsidiary or to any compensation following termination of
employment with or service to the Company or any Subsidiary; and (h) neither the
Company nor any Subsidiary has any present intention to terminate the employment
or engagement or service of any officer or any significant employee or
consultant
 
3.17.2. Except as set forth in the SEC Reports, there are no outstanding or, to
the knowledge of the Company, threatened claims against the Company or any
Subsidiary or any Affiliate (whether under federal or state law, under any
employment agreement, or otherwise) asserted by any present or former employee
or consultant of the Company or any Subsidiary.  Neither the Company nor any
Subsidiary is in violation of any law or Requirement of Law concerning
immigration or the employment of persons other than U.S. citizens.
 
3.18 Pension and Other Employee Benefit Plans.
 
3.18.1. There are set forth or identified in the SEC Reports all of the plans,
funds, policies, programs and arrangements sponsored or maintained by the
Company or any Subsidiary on behalf of any employee or former employee of the
Company or any Subsidiary (or any dependent or beneficiary of any such Employee
or former employee) with respect to (a) deferred compensation or retirement
benefits; (b) severance or separation from service benefits (other than those
required by law); (c) incentive, performance, stock, share appreciation or bonus
awards; (d) health care benefits; (e) disability income or wage continuation
benefits; (f) supplemental unemployment benefits; (g) life insurance, death or
survivor’s benefits; (h) accrued sick pay or vacation pay; or (i) any other
material benefit offered under any arrangement constituting an “employee benefit
plan” within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”) and not excepted by Section 4 of
ERISA (the foregoing being collectively called “Employee Benefit
Plans”).  Schedule ‎3.18.1 sets forth all such Employee Benefit Plans subject to
the provisions of Section 412 of the Code as well as any “multi-employer plans”
within the meaning of Section 3(37) of ERISA or Section 4001(a)(3) of ERISA.
Except as set forth on Schedule ‎3.18.1,  the transactions contemplated by this
Agreement will not result in any payment or series of payments by the
Purchasers, the Company or any Subsidiary of an “excess parachute payment”
within the meaning of Section 280G of the Code or any other severance, bonus or
other payment on account of such transactions.  Except as set forth on Schedule
‎3.18.1, none of the Employee Benefit Plans is under investigation or audit by
the United States Department of Labor, the Internal Revenue Service or any other
Governmental or Regulatory Authority.
 
3.18.2. Except as set forth in the SEC Reports, (a) the Company and each
Subsidiary has complied with its obligations under all applicable Requirements
of Law including, without limitation, of ERISA and the Code with respect to such
Employee Benefit Plans and all other arrangements that provide compensation or
benefits to any Employee and the terms thereof, whether or not such person is
directly employed by the Company or any Subsidiary and (b) there are no pending
or, to the knowledge of the Company, threatened actions or claims for benefits
by any Employee, other than routine claims for benefits in the ordinary course
of business.  No Employee Benefit Plan provides any benefits to any former
employees.
 
3.18.3. All Employee Benefit Plans that are intended to meet the requirements of
Section 401(a) of the Code have been determined by the Internal Revenue Service
to meet such requirements and have at all times operated in compliance with such
requirements.
 
 
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3.18.4. All employment Taxes, premiums for employee benefits provided through
insurance, contributions to Employee Benefit Plans, and all other compensation
and benefits to which employees are entitled, have been timely paid or provided
as applicable, and there is no liability for any such payments, contributions or
premiums.

3.19 Real Property.  Neither the Company nor any Subsidiary has any interest in
any real estate, except that the Company and its Subsidiaries lease the
properties described in the SEC Reports or on Schedule 3.19 (the “Leased Real
Property”).  The Leased Real Property is adequate for the operations of each of
the Company and its Subsidiaries’ businesses as currently conducted and as
contemplated to be conducted.  Except as set forth in the SEC Reports, the
Company and each Subsidiary has paid all amounts due from it, and is not in
default under any of the Real Property Leases and there exists no condition or
event, which, with the passage of time, giving of notice or both, would
reasonably be expected to give rise to a default under or breach of the Real
Property Leases.

3.20 Permits; Regulatory.
 
3.20.1           No Regulatory Approval or Consent of, or any designation,
declaration or filing with, any Governmental or Regulatory Authority or any
other Person is required in connection with the valid execution, delivery and
performance of this Agreement and the other Transaction Documents (including,
without limitation, the issuance of the Units), except such Regulatory
Approvals, Consents, designations, declarations or filings that have been duly
and validly obtained or filed, or with respect to any filings that must be made
after the Initial Closing or the Subsequent Closing as will be filed in a timely
manner. Except as set forth in Schedule 3.20.1, the Company and each Subsidiary
has all franchises, Permits, licenses and any similar authority necessary for
the conduct of its business as now being conducted, including, without
limitation, the Food and Drug Administration (“FDA”) of the U.S. Department of
Health and Human Services.
 
3.20.2 To the best of the Company’s knowledge, all manufacturing and production
operations conducted by the Company or  (or by third parties on behalf of the
Company and its Subsidiaries including, without limitation, any manufacturing or
production being done by any third party in connection with any feasibility,
preclinical, clinical or other study, test or trial for or on behalf of the
Company or any Subsidiary or any such study, test or trial that is being
sponsored by the Company or any Subsidiary or in which the Company or any
Subsidiary or any of the Company and its Subsidiaries’ Products is
participating), if any, relating to the manufacture or production of the
Products are being conducted in compliance with all applicable Requirements of
Law including to the extent mandated by relevant regulatory agencies, without
limitation, current Good Manufacturing Practices or similar foreign
requirements.
 
3.20.3 Except as set forth in Schedule 3.20.2, neither the Company nor any
Subsidiary or, to the knowledge of the Company, any other Person has received
(a) any reports of inspection observations, (b) any establishment inspection
reports or (c) any warning letters or any other documents from the FDA or any
other Governmental or Regulatory Authority relating to the Products and/or
arising out of the conduct of any Subsidiary or any Person which has conducted
or is conducting any feasibility, preclinical, clinical or other study, test or
trial for or on behalf of the Company or any Subsidiary or any such study, test
or trial that is being sponsored by the Company or any Subsidiary or in which
any of the Company’s or any Subsidiary’s Products is participating that assert a
material violation or material non-compliance with any applicable Requirements
of Law (including, without limitation, those of the FDA).
 
3.21 Environmental and Safety Laws.  Neither the Company nor any Subsidiary has
caused or allowed, or contracted with any party for, the generation, use,
transportation, treatment, storage or disposal of any Hazardous Substances in
connection with the operation of its business or otherwise, except in compliance
with all applicable Environmental Laws.  To the best of the Company’s knowledge,
the Company and each Subsidiary and the operation of their respective businesses
are in compliance with all applicable Environmental Laws.  To the best of the
Company’s knowledge, all of the Leased Real Property and all other real property
which the Company or any Subsidiary occupy (the “Premises”) is in compliance
with all applicable Environmental Laws and Orders or directives of any
Governmental or Regulatory Authority having jurisdiction under such
Environmental Laws, including, without limitation, any Environmental Laws or
Orders or directives with respect to any cleanup or remediation of any release
or threat of release of Hazardous Substances.  Each of the Company and its
Subsidiaries and the operation of their respective businesses are and have been
in compliance with all applicable Environmental Laws. To the knowledge of the
Company, there have occurred no and there are no events, conditions,
circumstances, activities, practices, incidents, or actions that may give rise
to any common law or statutory liability, or otherwise form the basis of any
Legal Proceeding, any Order, any remedial or responsive action, or any
investigation or study involving or relating to the Company or any Subsidiary,
based upon or related to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling, or the emission, discharge,
release or threatened release into the environment, of any pollutants,
contaminants, chemicals, or industrial, toxic or Hazardous Substance. To the
knowledge of the Company, (a) there is no asbestos contained in or forming a
part of any building, structure or improvement comprising a part of any of the
Leased Real Property, (b) there are no polychlorinated byphenyls (PCBs) present,
in use or stored on any of the Leased Real Property, and (c) no radon gas or the
presence of radioactive decay products of radon are present on, or underground
at any of the Leased Real Property at levels beyond the minimum safe levels for
such gas or products prescribed by applicable Environmental Laws.  Each of the
Company and its Subsidiaries has obtained and is maintaining in full force and
effect all necessary Permits, licenses and approvals required by all
Environmental Laws applicable to the Premises and the business operations
conducted thereon, and is in compliance with all such Permits, licenses and
approvals. Neither the Company nor any Subsidiary has caused or allowed a
release, or a threat of release, of any Hazardous Substance onto, at or near the
Premises, and, to the knowledge of the Company, neither the Premises nor any
property at or near the Premises has ever been subject to a release, or a threat
of release, of any Hazardous Substance.
 
 
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3.22 Regulatory Permits.  The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their
respective businesses, except where the failure to possess such permits could
not reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Company nor any Subsidiary has received any notice of
proceedings relating to the revocation or modification of any Material Permit
 
3.23 Offering Valid.  Assuming the accuracy of the representations and
warranties of the Purchasers contained in the subscription agreements entered
into by each Purchaser in connection with this Agreement, the offer, sale and
issuance of the Units will be exempt from the registration requirements of the
Securities Act of 1933, as amended (the “Securities Act”), and will be exempt
from registration and qualification under applicable state securities laws.
 
3.24 Disclosure.  Except with respect to the material terms and conditions of
the transactions contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of
the Purchasers or their agents or counsel with any information that it believes
constitutes or might constitute material, non-public information. The Company
understands and confirms that the Purchasers will rely on the foregoing
representation in effecting transactions in securities of the Company. All of
the disclosure furnished by or on behalf of the Company to the Purchasers
regarding the Company and its Subsidiaries, their respective businesses and the
transactions contemplated hereby, is, as of each Closing Date, true and correct
and does 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.  The
press releases disseminated by the Company during the twelve months preceding
the date of this Agreement taken as a whole do not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made and when made, not misleading.  The
Company acknowledges and agrees that no Purchaser makes or has made any
representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in Section 4 hereof.
 
3.25 Investment Company Act.  Neither the Company nor any Subsidiary is an
“investment company”, or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended.
 
3.26 Foreign Payments; Undisclosed Contract Terms.
 
3.26.1. To the knowledge of the Company, neither the Company nor any Subsidiary
has made any offer, payment, promise to pay or authorization for the payment of
money or an offer, gift, promise to give, or authorization for the giving of
anything of value to any Person in violation of the Foreign Corrupt Practices
Act of 1977, as amended and the rules and regulations promulgated thereunder.
 
3.26.2. To the knowledge of the Company, there are no understandings,
arrangements, agreements, provisions, conditions or terms relating to, and there
have been no payments made to any Person in connection with any agreement,
Contract, commitment, lease or other contractual undertaking of the Company or
any Subsidiary which are not expressly set forth in such contractual
undertaking.
 
3.27 No Broker.  Neither the Company nor any Subsidiary has employed any broker
or finder, or incurred any liability for any brokerage or finder’s fees in
connection with the sale of the Units, or the Common Stock and Warrants
underlying the Units pursuant to this Agreement or the other Transaction
Documents.
 
3.28 Compliance with Laws.  Neither the Company nor any Subsidiary is in
violation of, or in default under, any Requirement of Law applicable to such
Subsidiary, or any Order issued or pending against such Subsidiary or by which
the Company’s or such Subsidiary’s properties are bound, except for such
violations or defaults that have not had, and could not reasonably be expected
to have, a Material Adverse Effect.
 
3.29 No Integrated Offering. Assuming the accuracy of the Purchasers’
representations and warranties set forth in Section 4, neither the Company, nor
any of its Affiliates, nor any Person acting on its or 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 cause this
offering of any of the shares of Common Stock, Warrants and Warrant Shares
(collectively, the “Securities”) to be integrated with prior offerings by the
Company for purposes of (i) the Securities Act which would require the
registration of any such securities under the Securities Act, or (ii) any
applicable shareholder approval provisions of any Trading Market on which any of
the securities of the Company are listed or designated.
 
3.30 Application of Takeover Protections.  The Company and the Board of
Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other similar
anti-takeover provision under the Company’s certificate of incorporation (or
similar charter documents) or the laws of its state of incorporation that is or
could become applicable to the Purchasers as a result of the Purchasers and the
Company fulfilling their obligations or exercising their rights under the
Transaction Documents, including without limitation as a result of the Company’s
issuance of the Securities and the Purchasers’ ownership of the Securities.
 
 
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3.31 No General Solicitation. Neither the Company nor any person acting on
behalf of the Company has offered or sold any of the Securities by any form of
general solicitation or general advertising.  The Company has offered the
Securities for sale only to the Purchasers and certain other “accredited
investors” within the meaning of Rule 501 under the Securities Act.
 
3.32 Foreign Corrupt Practices.  Neither the Company nor any Subsidiary, nor to
the knowledge of the Company or any Subsidiary, any agent or other person acting
on behalf of the Company or any Subsidiary, has: (i) directly or indirectly,
used any funds for unlawful contributions, gifts, entertainment or other
unlawful expenses related to foreign or domestic political activity, (ii) made
any unlawful payment to foreign or domestic government officials or employees or
to any foreign or domestic political parties or campaigns from corporate funds,
(iii) failed to disclose fully any contribution made by the Company or any
Subsidiary (or made by any person acting on its behalf of which the Company is
aware) which is  in violation of law or (iv) violated in any material respect
any provision of the Foreign Corrupt Practices Act of 1977, as amended.
 
3.33 Stock Option Plans. Except as set forth in the SEC Reports or on, each
stock option or stock issuance granted by the Company under the Company’s stock
incentive plan was granted (i) in accordance with the terms of the Company’s
stock incentive plan and (ii) such options had an exercise price at least equal
to the fair market value of the Common Stock on the date such stock option would
be considered granted under GAAP and applicable law. No stock option granted
under the Company’s stock option plan has been backdated.  The Company has not
knowingly granted, and there is no and has been no Company policy or practice to
knowingly grant, stock options prior to, or otherwise knowingly coordinate the
grant of stock options with, the release or other public announcement of
material information regarding the Company or its Subsidiaries or their
financial results or prospects.
 
3.34 Office of Foreign Assets Control.  Neither the Company nor any Subsidiary
nor, to the Company's knowledge, any director, officer, agent, employee or
affiliate of the Company or any Subsidiary is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”).
 
3.35 U.S. Real Property Holding Corporation.  The Company is not and has never
been a U.S. real property holding corporation within the meaning of Section 897
of the Internal Revenue Code of 1986, as amended, and the Company shall so
certify upon Purchaser’s request.
 
3.36 Money Laundering.  The operations of the Company and its Subsidiaries are
and have been conducted at all times in compliance with applicable financial
record-keeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, applicable money laundering
statutes and applicable rules and regulations thereunder (collectively, the
“Money Laundering Laws”), and no action, suit or proceeding by or before any
court or governmental agency, authority or body or any arbitrator involving the
Company or any Subsidiary with respect to the Money Laundering Laws is pending
or, to the knowledge of the Company or any Subsidiary, threatened.
 
3.37 Bad Actor Disqualification
 
(a) No Disqualification Events. With respect to Securities to be offered and
sold hereunder in reliance on Rule 506 under the Securities Act ("Regulation D
Securities"), none of the Company, any of its predecessors, any affiliated
issuer, any director, executive officer, other officer of the Company
participating in the offering, any beneficial owner of 20% or more of the
Company's outstanding voting equity securities, calculated on the basis of
voting power, nor any promoter (as that term is defined in Rule 405 under the
Securities Act) connected with the Company in any capacity at the time of sale
(each, an "Issuer Covered Person" and, together, "Issuer Covered Persons") is
subject to any of the "Bad Actor" disqualifications described in Rule
506(d)(1)(i) to (viii) under the Securities Act (a "Disqualification Event"),
except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The
Company has exercised reasonable care to determine whether any Issuer Covered
Person is subject to a Disqualification Event. The Company has complied, to the
extent applicable, with its disclosure obligations under Rule 506(e), and has
furnished to the Purchasers a copy of any disclosures provided thereunder.
 
(b) Other Covered Persons. The Company is not aware of any person that (i) has
been or will be paid (directly or indirectly) remuneration for solicitation of
purchasers in connection with the sale of the Securities and (ii) who is subject
to a Disqualification Event.
 
3.40           Notice of Disqualification Events. The Company will notify the
Purchaser in writing of (i) any Disqualification Event relating to any Issuer
Covered Person and (ii) any event that would, with the passage of time, become a
Disqualification Event relating to any Issuer Covered Person, prior to any
Closing of this Offering.
 
 
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3.41           Transactions with Affiliates and Employees.  Except as set forth
in the SEC Reports, none of the officers or directors of the Company and, to the
knowledge of the Company, none of the employees of the Company is presently a
party to any transaction with the Company or any Subsidiary (other than for
services as employees, officers and 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 officer, director or such employee or, to the
knowledge of the Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner, in each case in excess of $120,000 other than for: (i) payment of
salary or consulting fees for services rendered, (ii) reimbursement for expenses
incurred on behalf of the Company and (iii) other employee benefits, including
stock option agreements under any stock option plan of the Company.
 
3.42           Sarbanes-Oxley; Internal Accounting Controls.  The Company is in
material compliance with all provisions of the Sarbanes-Oxley Act of 2002 which
are applicable to it as of the Closing Date.  Except as disclosed in the SEC
Reports, the Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that: (i)
transactions are executed in accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management’s general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
Except as disclosed in the SEC Reports, the Company has established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) for the Company and designed such disclosure controls and procedures
to ensure that information required to be disclosed by the Company in the
reports it files or submits under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the Commission’s
rules and forms.  The Company’s certifying officers have evaluated the
effectiveness of the Company’s disclosure controls and procedures as of the end
of the period covered by the Company’s most recently filed periodic report under
the Exchange Act (such date, the “Evaluation Date”).  The Company presented in
its most recently filed periodic report under the Exchange Act the conclusions
of the certifying officers about the effectiveness of the disclosure controls
and procedures based on their evaluations as of the Evaluation Date.  Since the
Evaluation Date, there have been no changes in the Company’s internal control
over financial reporting (as such term is defined in the Exchange Act) that has
materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.

3.43           Listing and Maintenance Requirements.  The Common Stock is
registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the
Company has taken no action designed to, or which to its knowledge is likely to
have the effect of, terminating the registration of the Common Stock under the
Exchange Act nor has the Company received any notification that the SEC is
contemplating terminating such registration.  The Company has not, in the 12
months preceding the date hereof, received notice from any Trading Market on
which the Common Stock is or has been listed or quoted to the effect that the
Company is not in compliance with the listing or maintenance requirements of
such Trading Market. The Company is, and has no reason to believe that it will
not in the foreseeable future continue to be, in compliance with all such
listing and maintenance requirements.
 
3.44           Regulation M Compliance.  The Company has not, and to its
knowledge no one acting on its behalf has, (i) taken, directly or indirectly,
any action designed to cause or to result in the stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
any of the Securities, (ii) sold, bid for, purchased, or paid any compensation
for soliciting purchases of, any of the securities of the Company, or (iii) paid
or agreed to pay to any Person any compensation for soliciting another to
purchase any other securities of the Company.
 
3.45           DTC Status.  The Company’s transfer agent, Interwest Transfer
Company, Inc.                  , (the “Transfer Agent”) is a member participant
of the Depository Trust Company Automated Securities Transfer Program.  The
Company's Common Stock is currently eligible for transfer pursuant to the
Depository Trust Company Automated Securities Transfer Program. As of the date
of the Agreement, the Company’s securities are currently trading on NASDAQ under
the symbols “MDVX” and “MDVXW”.
 
3.46           OFAC. Neither the Company nor any Subsidiary or, to the Company’s
knowledge, any director, officer, agent, employee, Affiliate or person acting on
behalf of any Subsidiary, is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Treasury
Department (“OFAC”); and the Company will not directly or indirectly use the
proceeds of the sale of the Units, or lend, contribute or otherwise make
available such proceeds to any joint venture partner or other person or entity,
towards any sales or operations in Cuba, Iran, Syria, Sudan, Myanmar or any
other country sanctioned by OFAC or for the purpose of financing the activities
of any person currently subject to any U.S. sanctions.
 
3.47           Registration Rights.  Except as set forth in  SEC Reports and as
required pursuant to the Registration Rights Agreement, neither the Company nor
any Subsidiary is under any obligation, or has granted any rights that have not
been terminated, to register any of such Subsidiary’s currently outstanding
securities or any of its securities that may hereafter be issued.
 
 
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3.48           Material Non-Public Information. Except with respect to the
transactions contemplated hereby that will be publicly disclosed, neither the
Company nor any Subsidiary has provided any Purchaser with any information that
such Subsidiary believes constitutes material non-public information.
 
3.49           Right to Receive Additional Shares. Except as set forth in the
Memorandum, the SEC Reports or in connection with the Units issued in this
Offering, no existing shareholder of the Company has any right to cause the
Company to issue additional shares of Common Stock (the “Existing Right
Issuances”) to such shareholder.
 
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.
 
Each of the Purchasers hereby severally, and not jointly, represents and
warrants to the Company that each such Purchaser’s representations and
warranties in such Purchaser’s subscription agreement (each a “Subscription
Agreement” and collectively, the “Subscription Agreements”) entered into in
connection with this Agreement, in form and substance substantially the same as
the form of Subscription Agreement are true and correct as of their respective
Closing, and such representations and warranties are deemed repeated as if
contained herein.
 
5. CONDITIONS TO THE CLOSING.
 
5.1 Conditions to Purchasers’ Obligations at the Closings.  The obligations of
the Purchasers to consummate the transactions contemplated herein to be
consummated at the Initial Closing and of each Subsequent Closing, as the case
may be, are subject to the satisfaction, on or prior to the date of such
Closing, of the conditions set forth below and applicable thereto, which
satisfaction shall be determined, or may be waived in writing, the Purchasers or
Subsequent Closing Purchasers, as the case may be, who have subscribed for at
least a majority of the Units to be purchased at such Closing.
 
5.1.1. Representations and Warranties; Performance of Obligations.  Each of the
representations and warranties of the Company contained herein shall be true and
correct on and as of the Initial Closing Date.  As of the Initial Closing, the
Company shall have performed and complied with the covenants and provisions of
this Agreement required to be performed or complied with by it at or prior to
the Initial Closing Date. As to the Subsequent Closings, each of the
representations and warranties of the Company contained herein shall be true and
correct on and as of the Subsequent Closing Date, as qualified by any updated
Schedules delivered at least five (5) days in advance of the Subsequent Closing
to the Subsequent Closing Purchasers participating in the Subsequent Closing. As
to the Subsequent Closings, the Company shall have performed and complied with
the covenants and provisions of this Agreement and the other Transaction
Documents required to be performed or complied with by it at or prior to the
Subsequent Closing Date. At each Closing, the Purchasers participating in such
Closing shall have received certificates of the Company dated as of the date of
such Closing, signed by the president or chief executive officer of the Company,
certifying as to the fulfillment of the conditions set forth in this Section
‎5.1 and the truth and accuracy of the representations and warranties of the
Company contained herein (as qualified by the most recently delivered Schedules)
as of the Initial Closing Date and, as to each Subsequent Closing, the
Subsequent Closing Date.
 
5.1.2. Issuance in Compliance with Laws.  The sale and issuance of the Units
shall be legally permitted by all laws and regulations to which any of the
Purchasers and the Company are subject.
 
5.1.3. Filings, Consents, Permits, and Waivers.  The Company and the Purchasers
shall have made all filings and obtained any and all Consents, Permits, waivers,
and Regulatory Approvals necessary for consummation of the transactions
contemplated by the Agreement and the other Transaction Documents, except for
such filings as are not due to be made until after the applicable Closing.
 
5.1.4. Reservation of the Common Stock and Warrant Shares.  From and after the
Initial Closing and any Subsequent Closing, the Common Stock and Warrant Shares,
which were the subject of such Closing shall have been duly authorized and
reserved for issuance by the Board of Directors.
 
5.1.5. Registration Rights Agreement.  Concurrently with the issuance of the
Units occurring at the Initial Closing, the Registration Rights Agreement,
substantially in the form attached hereto as Exhibit D (the “Registration Rights
Agreement”), shall have been executed and delivered by the Company and each
Purchaser.
 
5.1.6. Proceedings and Documents.  All corporate and other proceedings in
connection with the transactions contemplated at the Closings and all documents
and instruments incident to such transactions shall be reasonably satisfactory
in substance and form to the Purchasers or the Subsequent Closing Purchasers, as
the case may be, and their counsel, and the Purchasers or the Subsequent Closing
Purchasers, as the case may be, and their counsel shall have received all such
counterpart originals or certified or other copies of such documents as they may
reasonably request.
 
 
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5.1.7. Proceedings and Litigation.  No action, suit or proceeding shall have
been commenced by any Person against any party hereto seeking to restrain or
delay the purchase and sale of the Units or the other transactions contemplated
by this Agreement or any of the other Transaction Documents.
 
5.1.8. No Material Adverse Effect.  Since the date hereof, there shall not have
occurred any effect, event, condition or circumstance (including, without
limitation, the initiation of any litigation or other legal, regulatory or
investigative proceeding) that individually or in the aggregate, with or without
the passage of time, the giving of notice, or both, that has had, or could
reasonably be expected to have, a Material Adverse Effect or which could
adversely affect the Company’s ability to perform its respective obligations
under this Agreement or any of the other Transaction Documents.
 
5.1.9. Updated Disclosures.  As to the Subsequent Closings, the Company must
have delivered to the Purchasers an updated set of schedules in accordance with
Section ‎5.1.1 and such updated schedules do not reveal any information or the
occurrence, since the Initial Closing Date, of any effect, event, condition or
circumstance, which individually, or in the aggregate, has had or could
reasonably be expected to have, a Material Adverse Effect and do not include any
state of facts that occur as a result of the breach by the Company of any of its
obligations under this Agreement or any of the other Transaction Documents.
 
5.1.10. Payment of Purchase Price.  As to the Initial Closing, each Purchaser
shall have delivered to the Company the total purchase price to be paid for such
Purchaser’s Initial Units, in the amount set forth opposite such Purchaser’s
name on Exhibit A, which shall be no less than $250,000 in aggregate gross
proceed.  As to each Subsequent Closing, each Subsequent Closing Purchaser shall
have delivered to the Company the total purchase price to be paid for such
Subsequent Closing Purchaser’s Subsequent Units.
 
5.1.11. Delivery of Documents at the Initial Closing.  The Company shall have
executed and delivered the following documents, on or prior to the Initial
Closing Date:
 
(a) Certificates.  Certificates representing the Common Stock to be purchased
and sold on the Initial Closing Date;
 
(b) Warrants:  An executed Warrant, in substantially the form of Exhibit B for
the Warrants to be issued on the Initial Closing Date;
 
(c) Secretary’s Certificate.  A certificate of the Secretary of the Company (i)
attaching and certifying as to the Company’s Certificate of Incorporation (the
“Certificate”), (ii) attaching and certifying as to the Bylaws of the Company in
effect at the Initial Closing, (iii) attaching and certifying as to copies of
resolutions by the Board of Directors of the Company authorizing and approving
this Agreement and the other Transaction Documents and the transactions
contemplated hereby (collectively, the “Minutes”); and (iv) certifying as to the
incumbency of the officers of the Company executing this Agreement and the other
Transaction Documents.
 
5.1.12. Delivery of Documents at the Subsequent Closing.  At any Subsequent
Closing, the Company shall deliver, or shall cause to be delivered to the
Subsequent Closing Purchasers the following documents, to be held in escrow
pending the completion of such Subsequent Closing:
 
(a) Certificates.  Certificates representing the Common Stock to be purchased
and sold on the Subsequent Closing Date bearing the legends required to be
placed on such certificates pursuant to the Transaction Documents;
 
(b) Warrants:  An executed Warrant, in substantially the form of Exhibit B for
the Warrants to be issued on the Subsequent Closing Date;
 
(c) Secretary’s Certificate.  A bring down of the Secretary’s Certificate.
 
5.2 Conditions to Obligations of the Company at the Closings.  The obligation of
the Company to consummate the transactions contemplated herein to be consummated
at the Initial Closing or the Subsequent Closing, as the case may be, is subject
to the satisfaction, on or prior to the date of such Closing of the conditions
set forth below and applicable thereto, any of which may be waived in writing by
the Company:
 
 
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5.2.1. Representations and Warranties; Performance of Obligations.  Each of the
representations and warranties of the Purchasers contained herein shall be true
and correct on and as of the Initial Closing Date. As of the Initial Closing
Date, the Purchasers shall have performed and complied with the covenants and
provisions of this Agreement required to be performed or complied with by them
at or prior to the Initial Closing Date.  As to the Subsequent Closing, each of
the representations and warranties of the Subsequent Closing Purchaser(s)
contained herein shall be true and correct on and as of the Subsequent Closing
Date.  As to the Subsequent Closing, the Subsequent Closing Purchaser(s) shall
have performed and complied with the covenants and provisions of this Agreement
required to be performed and complied with by them at or prior to the Subsequent
Closing Date.
 
5.2.2. Proceedings and Litigation.  No action, suit or proceeding shall have
been commenced by any Governmental Authority against any party hereto seeking to
restrain or delay the purchase and sale of the Units or the other transactions
contemplated by this Agreement.
 
5.2.3. Qualifications.  All Permits, if any, that are required in connection
with the lawful issuance and sale of the Units pursuant to this Agreement shall
be obtained and effective as of the Initial Closing or Subsequent Closing, as
applicable.
 
6. COVENANTS OF THE PARTIES.
 
6.1 Commercially Reasonable Efforts.  Upon the terms and subject to the
conditions set forth in this Agreement, the parties to this Agreement shall use
their respective good faith commercially reasonable efforts to take, or cause to
be taken, without any party being obligated to incur any material internal costs
or make any payment or payments to any third party or parties which,
individually or in the aggregate, are material and are not otherwise legally
required to be made, all actions, and to do or cause to be done, and to assist
and cooperate with the other parties in doing, all things necessary, proper or
advisable for such party to consummate and make effective, in the most
expeditious manner practicable, each Closing and the other transactions
contemplated hereunder.
 
6.2           Post-Closing Filings.  In connection with each Closing, the
Company and the Purchasers, if applicable, agree to file all required forms or
filings under applicable securities laws.
 
6.3           Transfer Restrictions.
 
6.3.1           The Securities may only be disposed of in compliance with state
and federal securities laws.  In connection with any transfer of Securities
other than pursuant to an effective registration statement or Rule 144
promulgated under the Securities Act, to the Company or to an Affiliate of a
Purchaser, the Company may require the transferor thereof to provide to the
Company an opinion of counsel selected by the transferor and reasonably
acceptable to the Company, the form and substance of which shall be reasonably
satisfactory to the Company, to the effect that such transfer does not require
registration of such transferred Securities under the Securities Act.  As a
condition of transfer, any such transferee shall agree in writing to be bound by
the terms of this Agreement and shall have the rights of a Purchaser under this
Agreement.
 
6.3.2           The Purchaser agrees to the imprinting, so long as is required
by this Section 6.1, of a legend on any of the Securities, including the Warrant
Shares, substantially in the following form:
 
[NEITHER] THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS
EXERCISABLE HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.
 
 
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6.3.3 Certificates evidencing the shares of Common Stock and Warrant Shares
shall be eligible for removal of the restrictive  legend set forth in Section
6.3.2 hereof, (a) following any sale of such shares of Common Stock or Warrant
Shares pursuant to Rule 144, or (b) if such shares of Common Stock, or Warrant
Shares are eligible for sale under Rule 144, without the requirement for the
Company to be in compliance with the current public information required under
Rule 144 as to such shares of Common Stock and Warrant Shares and without volume
or manner-of-sale restrictions, (c) following any sale of such shares of Common
Stock, or Warrant Shares, pursuant to the plan of distribution in an effective
registration statement (in compliance with any prospectus delivery
requirements), or (d) if such legend is not required under applicable
requirements of the Securities Act (including judicial interpretations and
pronouncements issued by the staff of the Commission) (the “Removal Date”).  The
Company shall cause its counsel to issue a legal opinion to the Transfer Agent
promptly after the Removal Date if required by the Transfer Agent to effect the
removal of the legend hereunder as permitted by applicable law then in
effect.  The Company agrees that following the Removal Date, it will, no later
than five (5) trading days following the delivery by a Purchaser to the Company
or the Transfer Agent of a certificate representing shares of Common Stock or
Warrant Shares, as the case may be, issued with a restrictive legend, together
with any reasonable certifications requested by the Company, the Company’s
counsel or the Transfer Agent (such fifth (5th) trading day, the “Legend Removal
Date”), deliver or cause to be delivered to such Purchaser a certificate
representing such shares that is free from all restrictive and other legends.
The Company may not make any notation on its records or give instructions to the
Transfer Agent that enlarge the restrictions on transfer set forth in this
Section 6. Certificates for shares of Common Stock and Warrant Shares subject to
legend removal hereunder shall be transmitted by the Transfer Agent to the
Purchaser by crediting the account of the Purchaser’s prime broker with the
Depository Trust Company System as directed by such Purchaser if the Transfer
Agent is then a participant in such system and the Company is eligible to use
such system and as directed by such Purchaser if either (i) there is an
effective registration statement permitting the resale of such shares of Common
Stock, or Warrant Shares by the Purchaser (and the Purchaser provides the
Company or the Company’s counsel with any requested certifications with respect
to future sales of such shares) or (ii) the shares are eligible for resale by
the Purchaser under Rule 144, without the requirement for the Company to be in
compliance with the current public information required under Rule 144 as to
such shares of Common Stock and Warrant Shares and without volume or
manner-of-sale restrictions.
 
6.3.4           In addition to any other rights available to a Purchaser, if the
Company fails to deliver to a Purchaser unlegended shares of Common Stock or
Warrant Shares as required pursuant to this Agreement and after the Legend
Removal Date such Purchaser, or a broker on such Purchaser’s behalf, purchases
(in an open market transaction or otherwise) shares of Common Stock to deliver
in satisfaction of a sale by such Purchaser of the shares of Common Stock or
Warrant Shares that such Purchaser was entitled to receive from the Company (a
“Buy-In”), then the Company shall promptly pay in cash to such Purchaser (in
addition to any remedies available to or elected by such Purchaser) the amount
by which (a) such Purchaser’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased exceeds (b) the
aggregate purchase price of the shares of Common Stock or the Warrant Shares
delivered to the Company for reissuance as unlegended shares (which amount shall
be paid as liquidated damages and not as a penalty). For example, if a Purchaser
purchases shares of Common Stock having a total purchase price of $11,000 to
cover a Buy-In with respect to Common Stock or Warrant Shares delivered to the
Company for reissuance as unlegended shares having an aggregate purchase price
of $10,000, the Company shall be required to pay the Purchaser $1,000, plus
interest. The Purchaser shall provide the Company written notice indicating the
amounts payable to the Purchaser in respect of the Buy-In. For purposes of this
Agreement, the “purchase price” of a (a) share of Common Stock shall be $1.20
per share, and (B) Warrant Share shall be the Exercise Price (as defined in the
Warrants).
 
6.3.5           In addition to such Purchaser’s other available remedies, the
Company shall pay to such Purchaser, in cash, as partial liquidated damages and
not as a penalty, for each $1,000 of shares of Common Stock or Warrant Shares
(based on a purchase price of $1.20 per share of Common Stock or the Exercise
Price for such Warrant Shares, as the case may be) delivered for removal of the
restrictive legend, $10 per trading day (increasing to $20 per trading day five
(5) trading days after such damages have begun to accrue)) for each trading day
after the fifth (5th) trading day following the Legend Removal Date until such
certificate is delivered without a legend. Nothing herein shall limit such
Purchaser’s right to pursue actual damages for the Company’s failure to deliver
certificates representing any Securities as required by the Transaction
Documents, and such Purchaser shall have the right to pursue all remedies
available to it at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief.
 
6.4 Furnishing of Information; Public Information. For so long as any Purchaser
holds any Securities, or if earlier, for a period of twenty-four (24) months
following the Termination Date (or the Final Termination Date if the Offering is
extended by the Company) the Company covenants to file all annual and quarterly
periodic reports with the SEC pursuant to Section 15(d) of the Exchange Act or
alternatively, if registered under Section 12(b) or 12(g) of the Exchange Act,
maintain the registration of the Common Stock under Section 12(b) or 12(g) of
the Exchange Act and to timely file (or obtain extensions in respect thereof and
file within the applicable grace period) all such annual and quarterly reports
required to be filed by the Company after the date hereof pursuant to the
Exchange Act.  Unless the Securities owned by such Purchaser shall have been
registered for resale, if at any time during the period commencing from the date
that is 6 months after the date hereof and ending 24 months following the
Termination Date (or the Final Termination Date if the Offering is extended by
the Company) the Company shall fail for any reason to satisfy the current public
information requirement under Rule 144(c) (a “Public Information Failure”) then,
in addition to such Purchaser’s other available remedies, the Company shall pay
to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by
reason of any such delay in or reduction of its ability to sell the Securities,
an amount in cash equal to two percent (2.0%) of the pro-rata portion of such
Purchaser’s Purchase Price attributable to the unsold shares of Common Stock and
Warrant Shares on the day of a Public Information Failure and on every thirtieth
(30th) day (prorated for periods totaling less than thirty (30) days) thereafter
until the earlier of (A) the date such Public Information Failure is cured and
(B) such time that such public information is no longer required for the
Purchasers to transfer their shares of Common Stock and Warrant Shares pursuant
to Rule 144.  The payments to which a Purchaser shall be entitled pursuant to
this Section 6.4 are referred to herein as “Public Information Failure
Payments”.  Public Information Failure Payments shall be paid on the earlier of
(Y) the last day of the calendar month during which such Public Information
Failure Payments are incurred, and (Z) the third (3rd) business day after the
event or failure giving rise to the Public Information Failure Payments is
cured.  Nothing herein shall limit such Purchaser’s right to pursue actual
damages for the Public Information Failure, and such Purchaser shall have the
right to pursue all remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief.
Notwithstanding anything herein to the contrary, the maximum payment hereunder
shall not exceed twelve (12%) percent of such Purchaser’s Purchase Price. As
long as any Purchaser owns Securities, if the Company is not required to file
reports pursuant to such laws, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) such information as is
required for the Purchasers to sell the Securities under Rule 144.  The Company
further covenants that it will take such further action as any holder of
Securities may reasonably request, to the extent required from time to time to
enable such person to sell such Securities without registration under the
Securities Act within the requirements of the exemption provided by Rule 144.
 
 
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6.5 Listing of Securities.  The Company agrees, (i) if the Company applies to
have the Common Stock traded on any other trading market, it will include in
such application the Warrant Shares of each Purchaser, and will take such other
action as is necessary or desirable to cause such Common Stock and any Warrant
Shares to be listed on such other trading market as promptly as possible, and
(ii) it will take all action reasonably necessary to continue the listing and
trading of its Common Stock on a Trading Market (as defined in the Warrant) and
will comply in all material respects with the Company’s reporting, filing and
other obligations under the bylaws or rules of any such Trading Market (as
defined in the Warrant).
 
6.6 Reservation of Shares.  From and after the Initial Closing and any
Subsequent Closing, the Company shall at all times thereafter while the Common
Stock and Warrants which were purchased and sold at such Closing are outstanding
maintain a reserve from its duly authorized shares of Common Stock of a number
of shares of Common Stock sufficient to allow for the issuance of Common Stock
and Warrant Shares, which were the subject of such Closing.
 
6.7 Replacement of Securities.  If any certificate or instrument evidencing any
Securities is mutilated, lost, stolen or destroyed, the Company shall issue or
cause to be issued in exchange and substitution for and upon cancellation
thereof, or in lieu of and substitution therefor, a new certificate or
instrument, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and customary and reasonable
indemnity, if requested.  The applicants for a new certificate or instrument
under such circumstances shall also pay any reasonable third-party costs
associated with the issuance of such replacement securities.  If a replacement
certificate or instrument evidencing any securities is requested due to a
mutilation thereof, the Company may require delivery of such mutilated
certificate or instrument as a condition precedent to any issuance of a
replacement.
 
6.8 Securities Laws; Publicity.  The Company shall by 8:30 a.m. (New York City
time) on the trading day immediately, following a Closing hereunder, file a
Current Report on Form 8-K disclosing the material terms of the transactions
contemplated hereby and including the Transaction Documents as exhibits thereto
to the extent required by law.  The Company shall not publicly disclose the name
of Purchaser, or include the name of any Purchaser in any filing with the SEC or
any regulatory agency or trading market, without the prior written consent of
Purchaser, except: (a) as required by federal securities law in connection with
the filing of final Transaction Documents (including signature pages thereto)
with the SEC and (b) to the extent such disclosure is required by law, in which
case the Company shall provide the Purchaser with prior notice of such
disclosure permitted under this clause (b).
 
6.9 Form D; Blue Sky Filings.  The Company agrees to timely file a Form D with
respect to the Securities as required under Regulation D promulgated under the
Securities Act and to provide a copy thereof, promptly upon request of the
Purchaser. The Company shall take such action as the Company shall reasonably
determine is necessary in order to obtain an exemption for, or to qualify the
Securities for, sale to the Purchaser at the Closing under applicable securities
or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.
 
6.10 Equal Treatment of Purchasers.  No consideration (including any
modification of any Transaction Document) shall be offered or paid to any person
to amend or consent to a waiver or modification of any provision of any of the
Transaction Documents unless the same consideration is also offered to all of
the parties to the Transaction Documents.
 
6.11 Non-Public Information.  Except with respect to the material terms and
conditions of the transactions contemplated by the Transaction Documents, the
Company covenants and agrees that neither it, nor any other person acting on its
behalf, will provide Purchaser or its agents or counsel with any information
that the Company believes constitutes material non-public information, unless
prior thereto Purchaser shall have executed a written agreement regarding the
confidentiality and use of such information.  The Company understands and
confirms that Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.
 
6.12 Use of Proceeds.  The Company shall use the net proceeds from the sale of
the Securities hereunder for working capital purposes and shall not use the
proceeds for (a) the satisfaction of any portion of the Company’s debt (other
than payment of trade payables in the ordinary course of the Company’s business
and prior practices), (b) the redemption of any Common Stock or Common Stock
Equivalents or (c) the settlement of any outstanding litigation.
 
6.13 Participation in Future Financing.    Except as otherwise set forth in this
Section 6.13:
 
6.13.1           From the date hereof until the one year anniversary of the
Final Closing Date, upon any issuance by the Company, any of its Subsidiaries
(or any resulting Person due to any “Spin-Outs”) in an offering pursuant to
which any of the foregoing raises gross proceeds of at least $1,000,000 of
Common Stock or Common Stock Equivalents (a “Subsequent Financing”), each
Purchaser shall have the right to participate in up to an amount of the
Subsequent Financing equal to such Purchaser’s proportionate share of the
Subsequent Financing based on such Purchaser’s participation in this Offering
(the “Participation Maximum”) on the same terms, conditions and price provided
for in the Subsequent Financing.
 
 
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6.13.2           At least 10 trading days prior to the closing of the Subsequent
Financing, the Company shall deliver to each Purchaser a written notice of its
intention to effect a Subsequent Financing (“Pre-Notice”), which Pre-Notice
shall ask such Purchaser if it wants to review the details of such financing
(such additional notice, a “Subsequent Financing Notice”).  Upon the request of
a Purchaser, and only upon a request by such Purchaser made within one trading
day following the receipt by the Purchaser of the Pre-Notice, for a Subsequent
Financing Notice, the Company shall promptly, but no later than one (1) trading
day after such request, deliver a Subsequent Financing Notice to such
Purchaser.  The Subsequent Financing Notice shall describe in reasonable detail
the proposed terms of such Subsequent Financing, the amount of proceeds intended
to be raised thereunder and the person or persons through or with whom such
Subsequent Financing is proposed to be effected and shall include a term sheet
or similar document relating thereto as an attachment.
 
6.13.3           Any Purchaser desiring to participate in such Subsequent
Financing must provide written notice to the Company by not later than 5:30 p.m.
(New York City time) on the 5th trading day after all of the Purchasers have
received the Pre-Notice that the Purchaser is willing to participate in the
Subsequent Financing, the amount of the Purchaser’s participation, and that the
Purchaser has such funds ready, willing, and available for investment on the
terms set forth in the Subsequent Financing Notice.  If the Company receives no
notice from a Purchaser as of such 5th trading day, such Purchaser shall be
deemed to have notified the Company that it does not elect to participate.
 
6.13.4           If by 5:30 p.m. (New York City time) on the 5th trading day
after all of the Purchasers have received the Pre-Notice, notifications by the
Purchasers of their willingness to participate in the Subsequent Financing (or
to cause their designees to participate) is, in the aggregate, less than the
total amount of the Subsequent Financing, then the Company may affect the
remaining portion of such Subsequent Financing on the terms and with the persons
set forth in the Subsequent Financing Notice.
 
6.13.5           If by 5:30 p.m. (New York City time) on the 5th trading day
after all of the Purchasers have received the Pre-Notice, the Company receives
responses to a Subsequent Financing Notice from Purchasers seeking to purchase
more than the aggregate amount of the Participation Maximum, each such Purchaser
shall have the right to purchase its Pro Rata Portion (as defined below) of the
Participation Maximum.  “Pro Rata Portion” means the ratio of (x) the Units
purchased on the Closing Date by a Purchaser participating under this Section
6.13 and (y) the sum of the aggregate Units purchased by all Purchasers
participating under this Section 6.13.
 
6.13.6           The Company must provide the Purchasers with a second
Subsequent Financing Notice, and the Purchasers will again have the right of
participation set forth above in this Section 6.13, if the Subsequent Financing
subject to the initial Subsequent Financing Notice is not consummated for any
reason on the terms set forth in such Subsequent Financing Notice within 30
trading days after the date of the initial Subsequent Financing Notice.
 
6.13.7           Notwithstanding the foregoing, this Section 6.13 shall not
apply in respect of issuances in connection with (i) an Exempt Issuance (as
defined below); (ii) an underwritten public offering pursuant to a registration
statement filed under the Securities Act; (iii) a joint venture or acquisition
of another entity by the Company, whether by purchase of stock, merger,
consolidation, purchase of all or substantially all of the assets of such entity
or otherwise; (iv) services rendered to or equipment leases of the Company.
 

6.13.8           For the purposes of this Sub-Section, Exempt Issuance shall
mean the issuance of (a) shares of Common Stock or options to employees,
officers or directors of the Company pursuant to any stock or option plan duly
adopted for such purpose, by a majority of the non-employee members of the Board
of Directors or a majority of the members of a committee of non-employee
directors established for such purpose (collectively, the “ESOP”), (b) except as
specifically provided herein, securities upon the exercise or exchange of or
conversion of any Securities issued hereunder and/or other securities
exercisable or exchangeable for or convertible into shares of Common Stock
issued and outstanding on the date of this Agreement, provided that such
securities have not been amended since the date of this Agreement to increase
the number of such securities or to decrease the exercise price, exchange price
or conversion price of such securities and which securities and the principal
terms thereof are set forth on Schedule 6.13, and (c) securities issued pursuant
to acquisitions or strategic transactions approved by a majority of the
directors of the Company, provided that any such issuance shall only be to a
Person (or to the equityholders of a Person) which is, itself or through its
subsidiaries, an operating company or an owner of an asset in a business
synergistic with the business of the Company and shall provide to the Company
additional benefits in addition to the investment of funds, but shall not
include a transaction in which the Company is issuing securities primarily for
the purpose of raising capital or to an entity whose primary business is
investing in securities.

6.14 Nasdaq Approval.   The Company shall have received evidence reasonably
satisfactory to the Company that the Shares and the Warrant Shares have been
approved for listing on the Nasdaq Capital Market, subject to official notice of
issuance.
 
 
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7. INDEMNIFICATION AND EXPENSES.

7.1 The Company Indemnification.  The Company shall indemnify and hold harmless
each Purchaser and any of such Purchaser’s Affiliates and any Person which
controls, is controlled by, or under common control with (within the meaning of
the Securities Act) such Purchaser or any such Affiliate, and each of their
respective directors and officers, and the successors and assigns and executors
and estates of any of the foregoing (each, an “Indemnified Party”, and
collectively, the “Indemnified Parties”) from and against all Indemnified Losses
imposed upon, incurred by, or asserted against any of the Indemnified Parties
resulting from, relating to or arising out of:

7.1.1. any representation or warranty made in this Agreement or any of the other
Transaction Documents or in any certificate or other instrument delivered by or
on behalf of the Company not being true and correct in any material respect when
made;
 
7.1.2. any breach or non-fulfillment of any covenant or agreement to be
performed by the Company under this Agreement or the other Transaction
Documents;
 
7.1.3. any third party action or claim against any Indemnified Party arising out
of any misrepresentation or breach described in Section ‎7.1.1 or Section
‎7.1.2; or
 
7.1.4. any third party action or claim relating in any way to the Indemnified
Party’s status as a security holder of the Company, as a Person which controls,
is controlled by or under common control with (within the meaning of the
Securities Act) any such Indemnified Party or as a director or officer of any of
the foregoing (including, without limitation, any and all Indemnifiable Losses
arising under the Securities Act, the Securities Exchange Act of 1934, as
amended, or similar securities law, or any other Requirements of Law or
otherwise, which relate directly or indirectly to the registration, purchase,
sale or ownership of any securities of the Company or to any fiduciary
obligation owed with respect thereto), including, without limitation, in
connection with any action or claim relating to any action taken or omitted to
be taken or alleged to have been taken or omitted to have been taken by such
Indemnified Party as a security holder; provided that the Company shall not be
obligated to indemnify or hold harmless any Indemnified Party under this Section
‎7.1.4 against any Indemnified Losses resulting from or arising out of any such
action or claim if it has been adjudicated by a final and non-appealable
determination of a court or other trier of fact of competent jurisdiction that
such Indemnified Losses were the result of (a) a breach of such Indemnified
Party’s fiduciary duty, (b) any action or omission made by the Indemnified Party
in bad faith, (c) such Indemnified Party’s willful misconduct, or (d) any
criminal action on the part of such Indemnified Party.
 
7.2           Attorneys’ Fees and Expenses.  If any action at law or in equity
(including arbitration) is necessary to enforce or interpret the terms of this
Agreement or any Transaction Document, the prevailing party shall be entitled to
reasonable attorneys’ fees, costs and necessary disbursements in addition to any
other relief to which such party may be entitled as determined by such court,
equity or arbitration proceeding.
 
8. MISCELLANEOUS.
 
8.1 Governing Law; Submission to Jurisdiction; Waiver of Trial by Jury.  This
Agreement shall be governed in all respects by the laws of the State of New
York without regard to the conflict of laws principles of the State of New York
or any other jurisdiction. No suit, action or proceeding with respect to this
Agreement or any of the Transaction Documents may be brought in any court or
before any similar authority other than in a court of competent jurisdiction in
the State of New York and the parties hereby submit to the exclusive
jurisdiction of such courts for the purpose of such suit, proceeding or
judgment. Each of the parties hereto hereby irrevocably waives any right which
it may have had to bring such an action in any other court, domestic or foreign,
or before any similar domestic or foreign authority and agrees not to claim or
plead the same. Each of the parties hereto hereby irrevocably and
unconditionally waives trial by jury in any legal action or proceeding in
relation to this Agreement or any of the Transaction Documents and for any
counterclaim therein.
 
8.2 Survival of Representations and Warranties.  The representations and
warranties made by the Company and the Purchasers herein at each Closing shall
survive such Closing for a period of twelve (12) months. All statements
contained in any certificate or other instrument delivered by or on behalf of
any party to this Agreement, pursuant to or in connection with the transactions
contemplated by this Agreement or any of the other Transaction Documents shall
be deemed to be representations and warranties made by such party as of the date
of such certificate or other instrument.
 
 
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8.3 Successors and Assigns.  The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns; provided that no party may assign, delegate or otherwise
transfer any of its rights or obligations under this Agreement without the
consent of each other party.  Notwithstanding the foregoing (a) any Purchaser
may assign or transfer, in whole or, from time to time, in part, the right to
purchase all or any portion of the Units to one or more of its Affiliates
(subject to Affiliate qualification as an Accredited Investor) and (b) from and
after the Initial Closing Date, any Purchaser or other holder of Common Stock
may assign, pledge or otherwise transfer, in whole or from time to time in part,
its rights hereunder to any Person who acquires any interest in any Common Stock
and (c) any Purchaser may assign or transfer any of its rights or obligations
under this Agreement, in whole or from time to time in part, to the Company or
any other Purchaser or any Affiliate of any other Purchaser.  As a condition of
any transfer pursuant to this Section ‎8.3, the transferee must agree in writing
for the benefit of all parties to this Agreement (which writing shall be in form
and substance reasonably acceptable to all parties to this Agreement) to be
bound by the terms and conditions of this Agreement and all other Transaction
Documents with respect to any Common Stock being transferred hereunder.
 
8.4 Entire Agreement.  This Agreement, the Exhibits and Schedules hereto, the
other Transaction Documents and each of the Exhibits delivered pursuant thereto
constitute the full and entire understanding and agreement between the parties
hereto with regard to the subject matter hereof and thereof and no party hereto
shall be liable or bound to any other party hereto in any manner by any
representations, warranties, covenants and agreements except as specifically set
forth herein and therein.
 
8.5 Severability.  If any provision of the Agreement is held to be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions of this Agreement shall not in any way be affected or
impaired thereby.
 
8.6 Amendment and Waiver.  Any provision of this Agreement may be amended or
waived if, but only if, such amendment or waiver is in writing and is signed by
the Company and the Purchasers (and, to the extent of any assignment under
Section ‎8.3 hereof, their respective permitted assigns and any permitted
assigns thereof) holding a majority of the voting power of the then outstanding
Common Stock and Warrant Shares purchased under this Agreement held by such
holders.
 
8.7 Delays or Omissions.  No delay or omission to exercise any right, power or
remedy accruing to any party, upon any breach, default or noncompliance by
another party under this Agreement, the other Transaction Documents, shall
impair any such right, power or remedy, nor shall it be construed to be a waiver
of any such breach, default or noncompliance, or any acquiescence therein, or of
or in any similar breach, default or noncompliance thereafter occurring.  Any
waiver or approval of any kind or character on any Purchaser’s part of any
breach, default or noncompliance under this Agreement, the other Transaction
Documents or any waiver on such party’s part of any provisions or conditions of
the Agreement, the other Transaction Documents, must be in writing and shall be
effective only to the extent specifically set forth in such writing.  All
remedies, either under this Agreement, the other Transaction Documents, or
otherwise afforded to any party, shall be cumulative and not alternative.
 
8.8 Notices.  All notices, requests, demands and other communications given or
made in accordance with the provisions of this Agreement shall be addressed (i)
if to a Purchaser, at such Purchaser’s address, fax number or email address, as
furnished to the Company on the signature page below or as otherwise furnished
to the Company by the Purchaser in writing, or (ii) if to the Company, to the
attention of the President at such address, fax number or email address
furnished to the Purchasers on the signature page below or as otherwise
furnished by the Company in writing, and shall be made or sent by a personal
delivery or overnight courier, by registered, certified or first class mail,
postage prepaid, or by facsimile or electronic mail with confirmation of
receipt, and shall be deemed to be given on the date of delivery when made by
personal delivery or overnight courier, 48 hours after being deposited in the
U.S. mail, or upon confirmation of receipt when sent by facsimile or electronic
mail.  Any party may, by written notice to the other, alter its address, number
or respondent, and such notice shall be considered to have been given three (3)
days after the overnight delivery, airmailing, faxing or sending via e-mail
thereof.
 
8.9 Expenses.  The Company shall pay all costs and expenses that it incurs with
respect to the preparation, negotiation, execution, delivery and performance of
this Agreement, including, without limitation, any costs and expenses of its
counsel.
 
8.10 Titles and Subtitles.  The titles of the sections and subsections of the
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement.
 
8.11 Counterparts; Execution by Facsimile Signature. This Agreement may be
executed in any number of counterparts (including execution by facsimile), each
of which shall be an original, but all of which together shall constitute one
instrument. This Agreement may be executed by facsimile signature(s) which shall
be binding on the party delivering same, to be followed by delivery of
originally executed signature pages.
 
 
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8.12 Acknowledgment.  Any investigation or other examination that may have been
made at any time by or on behalf of a party to whom representations and
warranties are made in this Agreement or in any other Transaction Documents
shall not limit, diminish, supersede, act as a waiver of, or in any other way
affect the representations, warranties and indemnities contained in this
Agreement and the other Transaction Documents, and the respective parties may
rely on the representations, warranties and indemnities made to them in this
Agreement and the other Transaction Documents irrespective of and
notwithstanding any information obtained by them in the course of any
investigation, examination or otherwise, whether before or after any Closing.
 
8.13 Publicity.  Except as otherwise required by law or applicable stock
exchange rules, no announcement or other disclosure, public or otherwise,
concerning the transactions contemplated by this Agreement shall be made, either
directly or indirectly, by any party hereto which mentions another party (or
parties) hereto without the prior written consent of such other party (or
parties), which consent shall not be unreasonably withheld, delayed or
conditioned.
 
8.14 No Third Party Beneficiaries.  Nothing in this Agreement, express or
implied, is intended to confer on any person other than the parties hereto or
their respective successors and assigns any rights, remedies, obligations or
Liabilities under or by reason of this Agreement.
 
8.15 Pronouns.  All pronouns contained herein, and any variations thereof, shall
be deemed to refer to the masculine, feminine or neutral, singular or plural, as
to the identity of the parties hereto may require.
 
9. DEFINITIONS.
 
As used in this Agreement, the following terms shall have the meanings herein
specified:
 
9.1 “Affiliate” shall mean, with respect to any Person specified: (i) any Person
that directly or indirectly through one or more intermediaries controls, is
controlled by or under common control with the Person specified; (ii) any
director, officer, or Subsidiary of the Person specified; and (iii) the spouse,
parents, children, siblings, mothers-in-law, fathers-in law, sons-in-law,
daughters-in-law, brothers-in-law, and sisters-in-law of the Person specified,
whether arising by blood, marriage or adoption, and any Person who resides in
the specified Person’s home.  For any director, officer, or Subsidiary of the
Person specified.  For purposes of this definition and without limitation to the
previous sentence, (x) “control” (including, with correlative meanings, the
terms “controlled by” and “under common control with”) of a Person means the
power, direct or indirect, to direct or cause the direction of management and
policies of such Person, whether through ownership of voting securities, by
contract or otherwise, and (y) any Person beneficially owning, directly or
indirectly, more than ten percent (10%) or more of any class of voting
securities or similar interests of another Person shall be deemed to be an
Affiliate of that Person.
 
9.2 “Agreement” shall have the meaning set forth in the preamble to this
Agreement.

9.3 “Balance Sheet Date” shall have the meaning set forth in Section 3.9.
 
9.4 “Budget” shall have the meaning set forth in Section 3.21.
 

9.5 “Certificate” shall have the meaning set forth in Section 5.1.13.
 
9.6 “Closing” shall mean the Initial Closing or the Subsequent Closing, as
applicable.
 
9.7 “Code” shall have the meaning set forth in Section 3.16.2.
 
9.8 “Closing Date” shall mean the Initial Closing Date or the Subsequent Closing
Date, as applicable.
 
9.9  “Common Stock” shall have the meaning set forth in the preamble to this
Agreement.
 
9.10 “Common Stock Equivalents” shall means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time
Common Stock, including, without limitation, any debt, preferred stock, rights,
options, warrants or other instrument that is at any time convertible into or
exercisable or exchangeable for, or otherwise entitles the holder thereof to
receive Common Stock.
 
 
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9.11 “Company” shall have the meaning set forth in the preamble to this
Agreement.
 
9.12 “Consents” shall mean any consents, waivers, approvals, authorizations, or
certifications from any Person or under any Contract, Organizational Document or
Requirement of Law, as applicable.
 
9.13 “Contracts” shall mean any indentures, indebtedness, contracts, leases,
agreements, instruments, licenses, undertakings and other commitments, whether
written or oral.
 
9.14 “Copyrights” shall mean all copyrights, copyrightable works, mask works and
databases, including, without limitation, any computer software (object code and
source code), Internet web-sites and the content thereof, and any other works of
authorship, whether statutory or common law, registered or unregistered, and
registrations for and pending applications to register the same including all
reissues, extensions and renewals thereto, and all moral rights thereto under
the laws of any jurisdiction.

9.15 “Employee” shall have the meaning set forth in Section 3.17.1.
 
9.16 “Employee Benefit Plans” shall have the meaning set forth in
Section 3.18.1.
 
9.17 “Encumbrances” shall mean any security interests, liens, encumbrances,
pledges, mortgages, conditional or installment sales Contracts, title retention
Contracts, transferability restrictions and other claims or burdens of any
nature whatsoever.
 
9.18 “Environmental Laws” shall mean any Federal, state or local law or
ordinance or Requirement of Law or regulation pertaining to the protection of
human health or the environment, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 9601, et seq., the Emergency Planning and Community Right-to-Know Act,
42 U.S.C. Sections 11001, et seq., and the Resource Conservation and Recovery
Act, 42 U.S.C. Sections 6901, et seq.
 
9.19 “ERISA” shall have the meaning set forth in Section 3.18.1.
 
9.20 “FDA” shall have the meaning set forth in Section 3.22.1.
 
9.21 “Financial Statements” shall have the meaning set forth in Section 3.8.
 
9.22 “Governmental or Regulatory Authority” shall mean any court, tribunal,
arbitrator, authority, agency, commission, official or other instrumentality of
the government of the United States or of any foreign country, any state or any
political subdivision of any such government (whether state, provincial, county,
city, municipal or otherwise).
 
9.23 “Hazardous Substances” shall mean oil and petroleum products, asbestos,
polychlorinated biphenyls, urea formaldehyde and any other materials classified
as hazardous or toxic under any Environmental Laws.
 
9.24 “Indemnified Losses” shall mean all losses, Liabilities, obligations,
claims, demands, damages, penalties, settlements, causes of action, costs and
expenses arising out of any third party claim or action against an Indemnified
Party, including, without limitation, the actual costs paid in connection with
an Indemnified Party’s investigation and evaluation of any claim or right
asserted against such Indemnified Party and all reasonable attorneys’, experts’
and accountants’ fees, expenses and disbursements and court costs including,
without limitation, those incurred in connection with the Indemnified Party’s
enforcement of the indemnification provisions of Section ‎7 of this Agreement.
 
9.25 “Indemnified Party” shall have the meaning set forth in Section ‎7.1.
 
9.26  “Initial Closing” shall have the meaning set forth in Section ‎2.1.
 
9.27 “Initial Closing Date” shall have the meaning set forth in Section ‎2.1.
 
9.28 “Initial Units” shall have the meaning set forth in Section 1.2.
 
9.29 “Leased Real Property” shall have the meaning set forth in Section 3.19.
 
 
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9.30 “Legal Proceeding” shall mean any action, suit, arbitration, claim or
investigation by or before any Governmental or Regulatory Authority, any
arbitration or alternative dispute resolution panel, or any other legal,
administrative or other proceeding.
 
9.31 “Liabilities” shall mean all obligations and liabilities including, without
limitation, direct or indirect indebtedness, guaranties, endorsements, claims,
losses, damages, deficiencies, costs, expenses, or responsibilities, in any of
the foregoing cases, whether fixed or unfixed, known or unknown, asserted or
unasserted, choate or inchoate, liquidated or unliquidated, or secured or
unsecured.
 
9.32 “Licensed Intellectual Property” shall mean all Copyrights, Patents,
Trademarks, technology rights and licenses, trade secrets, know-how, inventions,
methods, techniques and other intellectual property any one or more  Entities
have or has the right to use in connection with its business or their respective
businesses, as applicable, pursuant to license, sublicense, agreement or
permission.
 
9.33 “Material Adverse Effect” shall have the meaning set forth in Section 3.1.
 
9.34 “Material Contract” shall have the meaning set forth in Section ‎3.10.1.
 
9.35 “Order” shall mean any judgment, order, writ, decree, stipulation,
injunction or other determination whatsoever of any Governmental or Regulatory
Authority, arbitrator or any other Person whose finding, ruling or holding is
legally binding or is enforceable as a matter of right (in any case, whether
preliminary or final and whether voluntarily imposed or consented to).
 
9.36 “Organizational Documents” shall mean, with respect to any Person, such
Person’s articles or certificate of incorporation, by-laws or other governing or
constitutive documents, if any.
 
9.37 “Owned Intellectual Property” shall mean all Copyrights, Patents,
Trademarks, technology, trade secrets, know-how, inventions, methods, techniques
and other intellectual property owned by the Company or any of its Subsidiaries.
 
9.38 “Patents” shall mean patents and patent applications (including, without
limitation, provisional applications, utility applications and design
applications), including, without limitation, reissues, patents of addition,
continuations, continuations-in-part, substitutions, additions, divisionals,
renewals, registrations, confirmations, re-examinations, certificates of
inventorship, extensions and the like, any foreign or international equivalent
of any of the foregoing, and any domestic or foreign patents or patent
applications claiming priority to any of the above.
 
9.39 “Permits” shall mean all licenses, permits, certificates of authority,
authorizations, approvals, registrations, franchises, rights, Orders,
qualifications and similar rights or approvals granted or issued by any
Governmental or Regulatory Authority relating to the Business.
 
9.40 “Per Unit Purchase Price” shall have the meaning set forth in Section 1.2.
 
9.41 “Person” shall mean any individual, corporation, partnership, firm, joint
venture, association, limited liability company, limited liability partnership,
joint-stock company, trust, unincorporated organization or Governmental or
Regulatory Authority.
 
9.42 “Intentionally Omitted”
 
9.43  “Premises” shall have the meaning set forth in Section 3.23.
 
9.44 “Products” shall have the meaning set forth in Section 3.10.1(c)
 
9.45 “Purchase Price” shall mean the “Total Purchase Price Amount” set forth in
Exhibit A for each respective Purchaser.
 
9.46 “Purchasers” and “Purchaser” shall have the meaning set forth in the
preamble to this Agreement.
 
9.47 “Real Property Leases” shall have the meaning set forth in Section 3.19.
 
9.48 "Registration Rights Agreement” shall have the meaning set forth in Section
5.1.5.
 
9.49  “Regulatory Approvals” shall mean all Consents from all Governmental or
Regulatory Authorities.
 
 
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9.50 “Requirement of Law” shall mean any provision of law, statute, treaty,
rule, regulation, ordinance or pronouncement having the effect of law, and any
Order.
 
9.51 “Schedules” shall have the meaning set forth in the preamble to Section ‎3.
 
9.52 “SEC” shall mean Securities and Exchange Commission.
 
9.53 “SEC Reports” shall have the meaning set forth in Section 3.8.
 
9.54 “Securities” shall have the meaning set forth in Section 3.33.
 
9.55 “Securities Act” shall have the meaning set forth in Section 3.25.
 
9.56 “Subsequent Closing” shall mean the funding which occurs on the Subsequent
Closing Date.
 
9.57 “Subsequent Closing Date” shall have the meaning set forth in Section 2.2.
 
9.58 “Subsequent Closing Purchaser” shall have the meaning set forth in Section
‎1.3.
 
9.59  “Subsidiaries” and “Subsidiary” shall mean, with respect to any Person
(including the Company), any corporation, partnership, association or other
business entity of which more than 50% of the issued and outstanding stock or
equivalent thereof having ordinary voting power is owned or controlled by such
Person, by one or more Subsidiaries or by such Person and one or more
Subsidiaries of such Person.
 
9.60 “Suppliers” shall have the meaning set forth in Section 3.20.2.
 
9.61 “Tax Returns” shall mean any declaration, return, report, estimate,
information return, schedule, statements or other document filed or required to
be filed in connection with the calculation, assessment or collection of any
Taxes or, when none is required to be filed with a taxing authority, the
statement or other document issued by, a taxing authority.
 
9.62 “Taxes” shall mean (i) any tax, charge, fee, levy or other assessment
including, without limitation, any net income, gross income, gross receipts,
sales, use, ad valorem, transfer, franchise, profits, payroll, employment,
social security, unemployment, excise, estimated, stamp, occupancy, occupation,
property or other similar taxes, including any interest or penalties thereon,
and additions to tax or additional amounts imposed by any federal, state, local
or foreign Governmental or Regulatory Authority, domestic or foreign or (ii) any
Liability for the payment of any taxes, interest, penalty, addition to tax or
like additional amount resulting from the application of Treasury Regulation
§1.1502-6 or comparable Requirement of Law.

9.63 “Trademarks” shall mean trademarks, service marks, trade names, corporate
names, company names, business names, fictitious business names, trade styles,
uniform resource locators (URLs), domain names, trade dress, any other names and
locators associated with the Internet, other source of business identifiers,
whether registered or unregistered and whether or not currently in use, and
registrations, applications to register and all of the goodwill of the business
related to the foregoing.
 
9.64 “Transaction Documents” shall mean this Agreement, the Subscription
Agreements, the Warrant, the Registration Rights Agreement and all other
documents, certificates and instruments executed and delivered at any Closing.
 
9.65 “Units” shall have the meaning set forth in the preamble to this Agreement.
 
9.66  “Warrant Shares” shall have the meaning set forth in Section 1.1.
 

 
[SIGNATURES ON FOLLOWING PAGES]
 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Unit Purchase
Agreement as of [____________], 2016.
 
 
COMPANY:
 
MEDOVEX CORPORATION
 
 
By: _____________________________
Name:
Title:
 
Address:
 
Tel:
Fax:  
email:
     

 
 
PURCHASERS:
 
The Purchasers set forth on Exhibit A to the Agreement have executed a
Subscription Agreement with the Company which provides, among other things, that
by executing the Subscription Agreement each Purchaser is deemed to have
executed the UNIT PURCHASE AGREEMENT in all respects and is bound to purchase
the Units set forth in such Subscription Agreement and Exhibit A to the
Agreement.

 
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Company Disclosure Schedules

3.1 The Company is incorporated in the State of Nevada.  The Company is
qualified to do business in the State of Georgia, Minnesota and
Florida.  Streamline, Inc. is incorporated in the State of Nevada. Streamline,
Inc. is qualified to do business in the State of Minnesota.
 
3.2 N/A
 
3.7 The Company has 13,057,476 shares of Common Stock outstanding, 2,752,105
warrants to purchase Common Stock outstanding and options to purchase 594,900
shares of common stock.  The Company has 655,100 shares reserved for issuance
pursuant to its Incentive Stock Plan.
 
3.9 N/A
 
3.10 N/A
 
3.10.1 (f) If finances are available, the Company intends to sign agreements for
an EU registry trial for approximately $570,000, and a U.S. clinical trial for
approximately $2,300,000 in the fourth quarter. Both trials would require
payment over three years.
 
3.11 N/A
 
3.18 N/A
 
3.19 N/A
 
3.20.1. The Company has not applied to the FDA or European authorities for
approval of its Denervex device, but believes the subcontractors performing
development work on the device comply with all regulatory requirements.
 
3.20.3 We recently received a complaint involving four Streamline ISS poles at a
single hospital account. The complaint involved two items that can easily be
corrected with small design changes and we have already identified the
corrective action.  Our regulatory experts believe the change is such that we
will not need to recall any poles. They will determine if the complaint merits
FDA reporting. The ISS has been in service successfully for more than four years
without previous complaint.
 
3.49. The Company will issue shares of its common stock to outside Board members
at a value equivalent to the annual amount of Director’s fees ($15,000/director)
until such time as its cash position merits payment in cash.
 
6.13. The Company has the following securities that are exercisable into Common
Stock currently outstanding (not including options issued under the Company’s
Incentive Stock Plan).
 
           1.  1,396,044 warrants exercisable at $3.00 per share.
 
2.  41,739 warrants exercisable at $9.48 per share.
 
3.  500,000 warrants exercisable at $1.70 per share.
 
4.  777,322 warrants exercisable at $1.30 per share.
 
 
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EXHIBIT A

SCHEDULE OF PURCHASERS

Initial Closing

Name of Purchaser
Initial Units
Preferred
 Stock
Warrant Shares
Total Purchase
Price Amount
       
$
       
TOTAL: $

 
Subsequent Closing
 
Name of Subsequent Closing Purchaser
Subsequent Units
Preferred
 Stock
Warrant Shares
Total Purchase          Price Amount
       
TOTAL: $

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