Careview Communications, Inc. 8-K [cvrs-8k_051419.htm]

 

Exhibit 10.33 

 

TWELFTH AMENDMENT TO
NOTE AND WARRANT PURCHASE AGREEMENT

This TWELFTH AMENDMENT TO NOTE AND WARRANT PURCHASE AGREEMENT, dated as of May
15, 2019 (this “Amendment”), is made by and among CAREVIEW COMMUNICATIONS, INC.,
a Nevada corporation (the “Company”), such of the Existing Investors (as defined
below) who are identified as investors on Annex I attached hereto (the
“Investors”), the HealthCor Parties (as defined below), and such additional
Existing Investors as, together with the HealthCor Parties and the Investors
(collectively, the “Majority Investors”), are holders of at least a majority of
the shares of Common Stock issued or issuable (on an as converted basis) upon
conversion of the Notes and Warrants.

WITNESSETH:

WHEREAS, the Company, HealthCor Partners Fund, L.P. (“HealthCor Partners”),
HealthCor Hybrid Offshore Master Fund, L.P. (“HealthCor Hybrid” and, together
with HealthCor Partners, the “HealthCor Parties”) and certain additional
investors that purchased additional Notes and additional Warrants on February
17, 2015 (the “2015 Investors”), additional Notes and additional Warrants on
February 23, 2018 (the “February 2018 Investors”) and additional Notes on July
13, 2018 (the “July 2018 Investors” and, together with the 2015 Investors, the
February 2018 Investors and the HealthCor Parties, the “Existing Investors”) are
parties to that certain Note and Warrant Purchase Agreement, dated as of April
21, 2011 (as amended from time to time, including without limitation pursuant to
that certain Note and Warrant Amendment Agreement dated December 30, 2011, that
certain Second Amendment to Note and Warrant Purchase Agreement dated January
31, 2012, that certain Third Amendment to Note and Warrant Purchase Agreement
dated August 20, 2013, that certain Fourth Amendment to Note and Warrant
Purchase Agreement dated January 16, 2014, that certain Fifth Amendment to Note
and Warrant Purchase Agreement dated December 15, 2014, that certain Sixth
Amendment to Note and Warrant Purchase Agreement dated March 31, 2015, that
certain Seventh Amendment to Note and Warrant Purchase Agreement dated June 26,
2015, that certain Eighth Amendment to Note and Warrant Purchase Agreement dated
February 23, 2018, that certain Ninth Amendment to Note and Warrant Purchase
Agreement dated July 10, 2018, that certain Tenth Amendment to Note and Warrant
Purchase Agreement dated July 13, 2018 and that certain Eleventh Amendment to
Note and Warrant Purchase Agreement dated March 27, 2019, the “Purchase
Agreement”);

WHEREAS, as contemplated by the Purchase Agreement, the Company issued and sold
(a) $20,000,000 initial principal amount of Notes (the “2011 Notes”) and
Warrants to purchase 11,782,859 shares of Common Stock (the “2011 Warrants”) to
the HealthCor Parties on April 21, 2011, (b) $5,000,000 initial principal amount
of Supplemental Closing Notes (the “2012 Notes”) to the HealthCor Parties on
January 31, 2012, (c) $5,000,000 initial principal amount of 2014 Supplemental
Closing Notes and 2014 Supplemental Warrants to purchase 4,000,000 shares of
Common Stock to the HealthCor Parties on January 16, 2014, (d) $6,000,000
initial principal amount of Fifth Amendment Supplemental Closing Notes and Fifth
Amendment Supplemental Warrants to purchase 3,692,308 shares of Common Stock to
HealthCor Partners and the 2015 Investors on February 17, 2015, (e) $2,050,000
initial principal amount of Eighth Amendment Supplemental Notes and Eighth
Amendment Supplemental Warrants to purchase 512,500 shares of Common Stock to
the February 2018 Investors on February 23, 2018, and (f) $1,000,000 initial
principal amount of Tenth Amendment Supplemental Notes to the July 2018
Investors on July 13, 2018;

WHEREAS, pursuant to Section 7.9 of the Purchase Agreement and subject to the
terms and conditions contained herein, the parties hereto desire to amend the
Purchase Agreement as set forth herein for the purposes of, among other things,
providing for an additional investment in the Company by the Investors;

WHEREAS, the Investors wish to purchase from the Company, and the Company wishes
to sell and issue to the Investors, upon the terms and conditions stated herein
and in the Purchase Agreement, additional Notes in the initial aggregate
principal amount of $50,000, with a conversion price per share equal to $0.03
(subject to adjustment as described therein) (the “Twelfth Amendment
Supplemental Closing Notes”) on the later of May 15, 2019 or the satisfaction of
the closing conditions outlined herein (the “Twelfth Amendment Supplemental
Closing Date”);

   

 

WHEREAS, pursuant to Section 7.9 of the Purchase Agreement and subject to the
terms and conditions contained herein, the Majority Investors desire to consent
pursuant to Section 6.1 of the Purchase Agreement to the amendment by the
Company of its Charter and its Bylaws;

WHEREAS, pursuant to Section 7.9 of the Purchase Agreement and subject to the
terms and conditions contained herein, the Majority Investors desire to consent
pursuant to Section 6.12 of the Purchase Agreement to the Company’s issuance of
a warrant for the purchase of 250,000 shares of Common Stock, with an exercise
price per share equal to $0.03 (subject to adjustment as described therein), to
Dr. James R. Higgins in connection with his Tranche Three Loan (as defined in
the PDL Credit Agreement) to the Company to be made pursuant to the PDL Credit
Agreement on or about the date hereof (the “Tranche Three Loan Warrant”); and

WHEREAS, the Company and the Investors are executing and delivering this
Amendment in reliance upon the exemption from securities registration afforded
by the provisions of Regulation D, as promulgated by the Commission under the
Act.

NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties and covenants contained herein and in the Purchase Agreement, which
represent integral components of the transactions contemplated hereby and
thereby and shall be fully enforceable by the parties hereto, and for other good
and valuable consideration, the receipt and sufficiency of which hereby
acknowledged, the Company, the Majority Investors and the Investors mutually
agree as follows:

1.       Definitions. Capitalized terms used in this Amendment but not defined
in this Amendment shall have the meanings ascribed to them in the Purchase
Agreement.

2.       Amendment to Purchase Agreement. Section 1.3 of the Purchase Agreement
is hereby amended and restated in its entirety to read as follows:

“Sale of Additional Securities. After the Closing, the Company may sell to the
Investors, on the same terms and conditions as those contained in this Agreement
(as amended from time to time), up to $19,100,000 in additional Notes and
Warrants to purchase an additional 8,204,808 shares of Common Stock, and (a) any
such additional Notes shall be included within the definition of “Notes” under
this Agreement; (b) any such additional Warrants shall be included within the
definition of “Warrants” under this Agreement; (c) any such additional Notes and
additional Warrants shall be included within the definition of “Closing
Securities” under this Agreement; (d) any shares of Common Stock issuable upon
conversion of any such additional Notes shall be included within the definition
of “Note Shares” under this Agreement; (e) any shares of Common Stock issuable
upon the exercise of any such additional Warrants shall be included within the
definition of “Warrant Shares” under this Agreement; and (f) any amendment or
joinder to this Agreement, the Notes, the Warrants, the Security Agreement, the
IP Security Agreement, the Registration Rights Agreement, the PDL Subordination
Agreement, the PDL Credit Agreement or any other documents contemplated or
necessitated hereby in order to further consummate the sale of any such
additional Notes and/or additional Warrants shall be included within the
definition of “Transaction Documents” under this Agreement. Any such additional
Notes shall be substantially in the form of the senior secured convertible note
attached hereto as Exhibit A, with such updates to the “Issuance Date”,
“Maturity Date”, “First Five Year Note Period”, “Conversion Price” and other
terms as shall be mutually acceptable to the Company and the Investors. Any such
additional Warrants shall be substantially in the form of common stock warrant
attached hereto attached hereto as Exhibit B, with such updates to the
“Expiration Date”, “Warrant Price” and other terms as shall be mutually
acceptable to the Company and the Investors.”

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3.       Issuance of Twelfth Amendment Supplemental Closing Notes. Subject to
the terms and conditions of this Amendment and the Purchase Agreement, on the
Twelfth Amendment Supplemental Closing Date, each of the Investors listed on
Annex I shall severally, and not jointly, purchase from the Company, and the
Company shall sell and issue to each Investor, the Twelfth Amendment
Supplemental Closing Notes in the respective amounts set forth opposite each
such Investor’s name on Annex I in exchange for a cash payment by each such
Investor of the amount set forth opposite such Investor’s name on Annex I (the
“Twelfth Amendment Supplemental Purchase Price”). The Twelfth Amendment
Supplemental Closing Notes shall be substantially in the form attached hereto as
Exhibit A-1. The closing of the purchase, sale and issuance of the Twelfth
Amendment Supplemental Closing Notes (the “Twelfth Amendment Supplemental
Closing”) shall take place on the Twelfth Amendment Supplemental Closing Date at
the offices of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo PC, One Financial
Center, Boston, MA 02111, or at such other location as the Company and the
Investors shall mutually agree. At the Twelfth Amendment Supplemental Closing,
the Company shall have satisfied the closing conditions set forth in subsections
(c), (e), (f) and (k) of Section 4.1 of the Purchase Agreement as of the Twelfth
Amendment Supplemental Closing Date (for avoidance of doubt, reading references
to the “Closing Date” in such subsections to refer to the Twelfth Amendment
Supplemental Closing Date) and shall deliver to the Investors the Twelfth
Amendment Supplemental Closing Notes, each registered in such name or names as
the Investors may designate. On the Twelfth Amendment Supplemental Closing Date,
the Investors shall deliver their respective portion of the Twelfth Amendment
Supplemental Purchase Price to the Company, payable by wire transfer in same day
funds to an account specified by the Company in writing. The Twelfth Amendment
Supplemental Closing Notes shall be secured as and to the same extent as the
other Notes issued pursuant to the Purchase Agreement, as described in the
Transaction Documents, including, without limitation, the Security Agreement and
IP Security Agreement.

4.       Conditions Precedent. The Twelfth Amendment Supplemental Closing shall
be further conditioned upon (a) the execution and delivery, as of the Twelfth
Amendment Supplemental Closing, by the Company, CareView Texas, PDL and the
other parties thereto of the Fifth Amendment to Credit Agreement, in the form
attached as Exhibit B-1 hereto; and (b) confirmation from the Company of
approval by (i) the Company’s Board of Directors and (ii) at least the requisite
percentage of the Company’s stockholders, of an amendment to the Company’s
Articles of Incorporation increasing the number of authorized shares of its
Common Stock to 500,000,000 (it being understood that the Company intends to
file such amendment of its Charter with the Secretary of State of the State of
Nevada to take effect twenty days after the distribution of an information
statement to the Company’s stockholders in connection with such action).

5.       Consent.

(a)       The Majority Investors hereby consent, pursuant to Section 6.1 and
Section 7.9 of the Purchase Agreement, to the amendment by the Company of its
Charter and its Bylaws in the form attached as Exhibit C-1 and Exhibit C-2,
respectively.

(b)       The Majority Investors hereby consent, pursuant to Section 6.12 and
Section 7.9 of the Purchase Agreement, to the issuance by the Company of the
Tranche Three Loan Warrant in the form attached as Exhibit D-1.

6.       Bringdown of Investors’ Representations and Warranties. Each Investor,
severally and not jointly, represents and warrants to the Company that the
statements contained in Article 3 of the Purchase Agreement are true and correct
as of the Twelfth Amendment Supplemental Closing Date as though made as of the
Twelfth Amendment Supplemental Closing Date (for this purpose, reading any
reference to “Closing Securities” in such Article 3 to refer only to the Twelfth
Amendment Supplemental Closing Notes).

7.       Form D and Blue Sky. The Company agrees to file a Form D with respect
to the Twelfth Amendment Supplemental Closing Notes as required under
Regulation D and to provide a copy thereof to the Investors promptly after such
filing. The Company shall take such action as is necessary in order to obtain an
exemption for or to qualify the Twelfth Amendment Supplemental Closing Notes for
sale to the Investors at the Twelfth Amendment Supplemental Closing pursuant to
this Amendment under applicable securities or “Blue Sky” laws of the states of
the United States, and shall provide evidence of any such exemption or
qualification so taken to the Investors on or prior to the Twelfth Amendment
Supplemental Closing Date promptly upon the request of any Investor.

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8.       Acknowledgement and Undertaking by Company. The Company agrees and
acknowledges that the transactions described in this Amendment and the issuance
of the Twelfth Amendment Supplemental Closing Notes and shares of Common Stock
upon exercise or conversion of the Twelfth Amendment Supplemental Closing Notes
are intended to be exempt from Section 16(b) of the Exchange Act to the maximum
extent permitted by law including pursuant to Rule 16b-3 under the Exchange Act
and the Commission’s releases and interpretations, and will, or will cause its
successors and assigns to, from time to time as and when requested by the
Investors, execute and deliver, or cause to be executed and delivered, to the
extent it may lawfully do so, all such documents and instruments and take, or
cause to be taken, to the extent it may lawfully do so, all such further actions
as the Investors may reasonably deem necessary and desirable to facilitate and
effect any such exemption. 

9.       No Further Amendments. Except as amended by this Amendment, the
Purchase Agreement shall remain in full force and effect in accordance with its
terms.

10.       Miscellaneous.

(a)       Ratification and Confirmation. The Company acknowledges, agrees and
confirms that: (x) the Purchase Agreement and each of the other Transaction
Documents, as amended and otherwise modified by the amendments and other
modifications specifically provided herein or contemplated hereby, are and shall
continue to be in full force and effect and are hereby in all respects ratified
and confirmed; and (y) without limiting the generality of the foregoing clause
(x), (i) all obligations, liabilities and Indebtedness of the Company under the
Transaction Documents, as amended hereby, constitute “Obligations” (as defined
in the Security Agreement) secured by and entitled to the benefits of the
security set forth in the Security Agreement and the IP Security Agreement, and
the liens and security interests granted in favor of the Investors under the
terms of the Security Agreement and the IP Security Agreement are and remain
perfected, effective, enforceable and valid and such liens and security
interests are, in each case, a first priority lien and security interest (except
to the extent otherwise expressly permitted by the Transaction Documents) and
such liens and security interests are hereby in all respects ratified and
confirmed, and (ii) the shares of Common Stock issuable upon exercise or
conversion of the Twelfth Supplemental Closing Notes shall constitute
“Registrable Securities” under the Registration Rights Agreement.

(b)       Expenses. The Company will pay and bear full responsibility for the
reasonable legal fees and other out-of-pocket costs and expenses of the
Investors attributable to the negotiation and consummation of the transactions
contemplated hereby.

(c)       Further Assurances. The Company shall duly execute and deliver, or
cause to be duly executed and delivered, at its own cost and expense, such
further instruments and documents and to take all such action, in each case as
may be necessary or proper in the reasonable judgment of the Investors to carry
out the provisions and purposes of this Amendment.

(d)       Survival. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any party hereto, the
execution and delivery of this Amendment and the closing of the transactions
contemplated hereby.

(e)       Governing Law. All questions concerning the construction,
interpretation and validity of this Amendment shall be governed by and construed
and enforced in accordance with the domestic laws of the State of Delaware
without giving effect to any choice or conflict of law provision or rule
(whether in the State of Delaware or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
Delaware. In furtherance of the foregoing, the internal law of the State of
Delaware will control the interpretation and construction of this Amendment,
even if under such jurisdiction’s choice of law or conflict of law analysis, the
substantive law of some other jurisdiction would ordinarily or necessarily
apply.

(f)       Construction. The Company and the Investors acknowledge that the
Company and its independent counsel and the Investors and their independent
counsel have jointly reviewed and drafted this document, and agree that any rule
of construction and interpretation to the effect that drafting ambiguities are
to be resolved against the drafting party shall not be employed.

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(g)       Counterparts; Facsimile and Electronic Signatures. This Amendment may
be executed in any number of counterparts, and each such counterpart hereof
shall be deemed to be an original instrument, but all such counterparts together
shall constitute but one agreement. Counterpart signatures to this Amendment
delivered by facsimile or other electronic transmission shall be acceptable and
binding.

(h)       Headings. The section and paragraph headings contained in this
Amendment are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Amendment.

[Signature Pages Follow]

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IN WITNESS WHEREOF, each of the undersigned has duly executed this Twelfth
Amendment to Note and Warrant Purchase Agreement as of the date first written
above.

 

  COMPANY:       CareView Communications, Inc.,
a Nevada corporation       By: /s/ Steven G. Johnson     Name: Steven G. Johnson
    Title: President

 

 

 

[Signature Page to Twelfth ‎Amendment to Note and Warrant Purchase Agreement]

 

 

 

 

 

  MAJORITY INVESTORS:       HealthCor Partners Fund, L.P.   By: HealthCor
Partners Management L.P., as Manager   By: HealthCor Partners Management, G.P.,
LLC, as General Partner

 

  By: /s/ Jeffrey C. Lightcap   Name: Jeffrey C. Lightcap   Title: Senior
Managing Director   Address: HealthCor Partners     1325 Avenue of Americas,
27th Floor     New York, NY 10019              

 

  HealthCor Hybrid Offshore Master Fund, L.P.   By: HealthCor Hybrid Offshore
G.P., LLC, as General Partner       By: /s/ Anabelle Gray   Name: Anabelle Gray
  Title:   Address: HealthCor Partners     1325 Avenue of Americas, 27th Floor  
  New York, NY 10019        

 

 

 

[Signature Page to Twelfth ‎Amendment to Note and Warrant Purchase Agreement]

 

 

 

 

 

  MAJORITY INVESTORS:           /s/ Steven B. Epstein   Steven B. Epstein      
    /s/ Dr. James R. Higgins   Dr. James R. Higgins           /s/ Steven G.
Johnson   Steven G. Johnson    

 

 

 

MAJORITY INVESTOR

AND INVESTOR:

          /s/ Jeffrey C. Lightcap   Jeffrey C. Lightcap

 

 

 

[Signature Page to Twelfth ‎Amendment to Note and Warrant Purchase Agreement]

 

 

 

 

ACKNOWLEDGED AND AGREED:

 

CareView Communications, Inc., a Texas corporation         By: /s/ Steven G.
Johnson   Name: Steven G. Johnson   Title: President               CareView
Operations, LLC         By: /s/ Steven G. Johnson   Name: Steven G. Johnson  
Title: President  

 

 

 

[Signature Page to Twelfth ‎Amendment to Note and Warrant Purchase Agreement]

 

 

 

 

Annex I

 

Twelfth Amendment Supplemental Closing Note Investors

 

Investor Twelfth Amendment Supplemental Closing Notes Twelfth Amendment
Supplemental Purchase Price Jeffrey C. Lightcap $50,000 $50,000 TOTAL $50,000
$50,000

 

 

 

 

 

 

Exhibit A-1

 

Form of Twelfth Amendment Supplemental Closing Notes

 

(attached)

 

 

 

 

Exhibit B-1

 

Form of Fifth Amendment to Credit Agreement

 

(attached)

 

 

Exhibit C-1

 

Form of Charter Amendment

 

(attached)

 

 

 

Exhibit C-2

 

Form of Bylaw Amendment

 

(attached)

 

 

 

Exhibit D-1

 

Form of Tranche Three Loan Warrant

 

(attached)