Exhibit 10.2

 

 

SUBSCRIBER NAME: VIVEVE MEDICAL, INC.

INVESTMENT AMOUNT:  $ 2,500,000
MEMBERSHIP UNITS (@$[*****] per unit):  [*****]

 

INCONTROL MEDICAL, LLC
MEMBERSHIP UNIT SUBSCRIPTION AGREEMENT

 

The undersigned subscriber named above (the “Subscriber”) desires to subscribe
from InControl Medical, LLC, a Wisconsin limited liability company (the
“Company”), the dollar amount and number of membership units in the Company
(“Membership Units”), as identified above and on the signature page hereto.

 

1.     Subscription. Subject to the terms and conditions of this Subscription
Agreement, the Subscriber hereby subscribes for the dollar amount and number of
Membership Units set forth above and on the signature page hereto for a total
investment amount as set forth above and on the signature page hereto (the
“Purchase Price”).

 

2.     Acceptance of Subscription. The Subscriber acknowledges that the Company,
in its sole discretion, has the right to accept or reject this subscription, in
whole or in part, for any reason whatsoever and that this subscription shall be
deemed to be accepted by the Company only when this Subscription Agreement is
executed by the Company. The Subscriber acknowledges and agrees (i) that
subscriptions need not be accepted in the order they are received and (ii) that
Membership Units to be sold by the Company may be allocated, in the event of
oversubscription, by the Company in its sole discretion.

 

3.     Understandings of the Subscriber. The Subscriber hereby represents and
warrants to, and covenants with, the Company, its managers, officers, members,
agents and affiliates, that the Subscriber is aware and understands that:

 

(a)     There are substantial risks incident to the purchase of the Membership
Units. An investment in the Membership Units is inherently speculative in
nature, and the Subscriber may suffer a complete loss of his/her/its investment,
and the tax consequences to the Subscriber of an investment in the Membership
Units will depend upon the Subscriber’s circumstances. Among other matters, the
Company was only recently formed, has a limited financial and operating history,
and has only recognized net losses to date.

 

(b)     The Membership Units have not been registered under the Securities Act
of 1933, as amended (the “Federal Securities Act”), or any state’s securities
act (collectively, the “State Securities Acts”), and are being offered for sale
pursuant to applicable exemptions from registration. No federal or state agency
or regulatory authority has made any finding or determination as to the fairness
of the offering of the Membership Units for investment, or any recommendation or
endorsement of the Membership Units.

 

(c)     The Subscriber may not sell, transfer or assign his/her/its Membership
Units, or any portion thereof, without registration under the Federal Securities
Act or the State Securities Acts or qualification or perfection of an applicable
exemption therefrom. Furthermore, the Membership Units are subject to additional
transfer restrictions as set forth in the Company’s Operating Agreement. In the
event any or all of the Membership Units are transferred to other than a
permitted transferee, the Membership Units shall automatically terminate.

 

(d)     Any illustrations or projections concerning the potential future
financial performance of the Company which may have been prepared in connection
with the Subscriber’s investment in the Company are only illustrations or
projections, and there can be no assurance whatsoever that they will be actually
realized. Any such illustrations or projections are subject to a variety of
factors over which the Company has no control and which could materially and
adversely affect any such illustrations or projections.

 

 

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4.     Representations, Warranties and Covenants of the Subscriber. The
Subscriber hereby represents and warrants to, and covenants with, the Company,
its managers, officers, members, agents and affiliates as follows:

 

(a)     The Subscriber hereby expressly represents that he/she/it is an
“Accredited Investor” within the meaning of Regulation D promulgated pursuant to
the Federal Securities Act, because the Subscriber comes within the Category or
Categories checked below (check each Category that applies):

 

❑ Category 1

The Subscriber is a natural person whose individual net worth, or joint net
worth with his or her spouse, at the time of purchase of the securities offered
by the Company, exceeds $1,000,000, excluding the value of the Subscriber’s
primary residence and any mortgage or other indebtedness relating thereto which
is secured by such residence up to the fair market value of such residence.

   

❑ Category 2

The Subscriber is a natural person who had an individual income in excess of
$200,000 in each of the two most recent years, or a joint income with his or her
spouse in excess of $300,000 in each of the two most recent years, and has a
reasonable expectation of reaching the same income level in the current year.

   

❑ Category 3

The Subscriber is a trust with total assets in excess of $5,000,000, not formed
for the specific purpose of acquiring any securities offered by the Company,
whose investments are directed by a sophisticated person as described in Rule
506(b)(2)(ii) under Regulation D under the Securities Act.

   

❑ Category 4

The Subscriber is a small business investment company (SBIC) licensed by the
U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958, as amended.

   

❑ Category 5

The Subscriber is a plan with total assets in excess of $5,000,000, established
and maintained by a state, a political subdivision of a state, or an agency or
instrumentality of a state or a political subdivision of a state for the benefit
of its employees.

   

❑ Category 6

The Subscriber is a private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940, as amended.

   

❑ Category 7

The Subscriber is an organization described in Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended, a corporation, a Massachusetts or similar
business trust, limited liability company or a partnership, not formed for the
specific purpose of acquiring any securities offered by the Company, with total
assets in excess of $5,000,000.

   

❑  Category 8

The Subscriber is a director or executive officer of the Company.

   

❑ Category 9

The Subscriber is an entity in which all of the equity owners are accredited
investor.  If Category 9 is checked, fill out the subscription page attached
hereto (i) listing the name of each equity owner and (ii) indicating, separately
for each equity owner, the Category or Categories (from Category 1 through
Category 16) that apply to such equity owner.

 

 

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❑ Category 10

The Subscriber is an employee benefit plan within the meaning of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), for which
investment decisions are made by a plan fiduciary, as defined in Section 3(21)
of ERISA, which is either a bank, savings and loan association, insurance
company, or registered investment adviser.

   

❑ Category 11

The Subscriber is an employee benefit plan within the meaning of ERISA having
total assets in excess of $5,000,000.

   

❑ Category 12

The Subscriber is an employee benefit plan within the meaning of ERISA that is a
self-directed plan with investment decisions made solely by persons that are
accredited investors. If Category 12 is checked, fill out the Category 12
Schedule attached hereto (i) listing the name of each person making investment
decisions and (ii) indicating, separately for each person making investment
decisions, the Category or Categories (from Category 1 through 16) that apply to
such person.

   

❑ Category 13

The Subscriber is a bank as defined in Section 3(a)(2) of the Securities Act, or
a savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act, acting in an individual or fiduciary capacity.

   

❑ Category 14

The Subscriber is a broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934, as amended.

   

❑ Category 15

The Subscriber is an insurance company as defined in Section 2(13) of the
Securities Act.

   

❑ Category 16

The Subscriber is an investment company registered under the Investment Company
Act of 1940, as amended (the “Investment Company Act”), or a business
development company as defined in Section 2(a)(48) of the Investment Company
Act. If the Subscriber is a trust, then, either the trustee must fall within
Category 13 or the trust must fall within Category 3 or 7.

 

(b)     The Subscriber hereby acknowledges that he/she/it has received all
information that the Subscriber considers relevant to an investment in the
Company. The Subscriber has had a full opportunity to ask questions of, and
receive answers from, the Company or any person or persons acting on behalf of
the Company concerning the terms and conditions of an investment in the Company.

 

(c)     The Subscriber (i) is acquiring the Membership Units solely for
his/her/its own account, and not for or on behalf of other persons; (ii) is
acquiring such Membership Units for investment purposes only, and not for resale
or distribution; and (iii) has no contract, agreement, undertaking or
arrangement, and no intention to enter into any contract, agreement, undertaking
or arrangement to sell, transfer or pledge such Membership Units or any part
thereof.

 

(d)     Subscriber hereby expressly represents that he/she/it (i) has adequate
means of providing for his/her/its current financial needs, including possible
future financial contingencies; and (ii) anticipates no need in the foreseeable
future to sell the Membership Units for which the Subscriber hereby subscribes.
The Subscriber is able to bear the economic risks of this investment and,
consequently, without limiting the generality of the foregoing, is able to hold
the Subscriber’s Membership Units for an indefinite period of time and has a
sufficient net worth to sustain a loss of his/her/its entire investment in the
Membership Units.

 

 

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(e)     The Subscriber has such knowledge and experience in financial and
business matters that the Subscriber is capable of evaluating the merits and
risks of an investment in the Membership Units.

 

(f)     The Subscriber, if a natural person, is over 21 years of age, a citizen
of the United States and legally competent to execute this Subscription
Agreement and the Company’s Operating Agreement and to make the representations,
warranties and covenants contained herein and therein. If the Subscriber is a
corporation, partnership, trust or other organization (i) it is duly organized,
validly existing and in good standing under the laws of the jurisdiction in
which it was formed and all other jurisdictions where such qualification is
necessary in light of the Subscriber’s activities; (ii) it has all the requisite
power and authority to invest in the Membership Units as provided herein and
execute and deliver the Company’s Operating Agreement and this Subscription
Agreement; (iii) such investment and execution will not result in any violation
of or conflict with any term of the organizational documents of the Subscriber
or any law or regulation applicable to it; (iv) such investment and execution
have been duly authorized by all necessary action on behalf of the Subscriber;
(v) this Subscription Agreement and the Company’s Operating Agreement have,
pursuant to proper authority, been duly executed and delivered on behalf of the
Subscriber and constitute legal, valid and binding agreements of the Subscriber,
enforceable against the Subscriber in accordance with their terms; and (vi) the
Subscriber has not been organized or reorganized for the specific purpose, or
for the purpose among other purposes, of acquiring the Membership Units.

 

(g)     All information which the Subscriber has provided to the Company
concerning himself, herself or itself, its, his or her financial position and
its, his or her knowledge of financial and business matters, or, in the case of
a corporation, partnership, trust or other entity or organization, the knowledge
of financial and business matters of the person making the investment decision
on behalf of such entity or organization, is correct and complete as of the date
set forth at the end hereof and may be relied upon, and if there should be any
material adverse change in such information prior to this subscription being
accepted, the Subscriber will immediately provide the Company with such
information.

 

5.     Indemnification. The Subscriber acknowledges that the Subscriber
understands the meaning and legal consequences of the representations,
warranties, covenants, agreements and restrictions contained in this
Subscription Agreement and the Company’s Operating Agreement and that the truth
of these representations, warranties, covenants, agreements and restrictions
will be relied upon by the Company, its managers, officers, members, agents and
affiliates in accepting the Subscriber as a member of the Company. With regard
to the representations, warranties, covenants, agreements and restrictions
contained in this Subscription Agreement and the Company’s Operating Agreement,
the Subscriber hereby agrees to indemnify and hold harmless the Company, its
managers, officers, members, agents and affiliates (collectively, the
“Indemnified Parties”), from and against any and all loss, damage or liability,
together with all costs and expenses including attorneys’ fees and
disbursements, which any of the Indemnified Parties may incur by reason of any
breach thereof by the Subscriber and any false, misleading or inaccurate
information contained therein.

 

6.     Survival. All representations, warranties, covenants, agreements and
restrictions contained in this Subscription Agreement and the Company’s
Operating Agreement and the indemnification contained in Section 5 shall survive
the acceptance of this subscription and the dissolution of the Company.

 

7.     Additional Information. The Subscriber covenants and agrees to promptly
furnish to the Company any and all information concerning the Subscriber and
his/her/its investment in the Company that the Company may from time to time
request for the purpose of complying with any federal, state, local or foreign
law, statute, rule, regulation or governmental or regulatory requirement, and
the Subscriber warrants and represents that, at the time any such information is
furnished to the Company, such information shall be accurate and complete.

 

 

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8.       Binding Effect. This Subscription Agreement and the Company’s Operating
Agreement shall be binding upon and inure to the benefit of the Company and its
successors and shall not be assignable by it without the prior written consent
of the Subscriber. This Subscription Agreement and the Company’s Operating
Agreement, upon acceptance by the Company shall, where applicable, be binding
upon the Subscriber and the Subscriber’s successors and assigns.

 

9.        Miscellaneous.

 

(a)     All notices or other communications given or made hereunder shall be in
writing to the Subscriber at the address set forth on the signature page hereto
and to the Company at c/o Foley & Lardner LLP, 777 East Wisconsin Avenue,
Milwaukee, WI 53202, Attn: Steven R. Barth.

 

(b)     This Subscription Agreement shall be construed in accordance with and
governed by the laws of Wisconsin.

 

(c)     This Subscription Agreement, together with the Company’s Operating
Agreement, constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and may be amended only by a writing
executed by the party to be charged.

 

(d)     Any masculine personal pronoun shall be considered to mean the
corresponding feminine or neuter personal pronoun, as the context requires.

 

10.     Acknowledgement and Consent for Member also Acting as Legal Counsel. The
Subscriber is aware that Steven R. Barth, a partner in Foley & Lardner LLP,
which firm is legal counsel to the Company, is the principal legal counsel to
the Company and is also a member in the Company. Similarly, the Subscriber is
aware that Foley Ventures, LLC, Foley Ventures II LLC and Foley Ventures III
LLC, all investment partnerships comprised of partners in Foley & Lardner LLP
(collectively, “Foley Ventures”), and other partners in Foley & Lardner, LLP are
also members in the Company. Additionally, the Subscriber is aware that Mr.
Barth, Foley Ventures and/or other partners in Foley & Lardner, LLP may be
investing in the Company in this Round O capital raise on the same terms and
conditions as other investors. The Subscriber acknowledges that he/she/it has
had an opportunity to consult with his/her/its own legal counsel regarding Mr.
Barth’s, Foley Ventures’ and/or other Foley & Lardner LLP partners’ direct or
indirect personal interest in the Company and that he/she/it has determined that
the terms and conditions of such investment are on the same terms as the
investment by the other investors in the Company and that such terms and
conditions are fair and reasonable to the Company and to the other members,
including the Subscriber. Moreover, the Subscriber understands that the
potential for a conflict of interest exists between Mr. Barth’s, Foley Ventures’
and other Foley & Lardner LLP partners’ personal investment interest in the
Company and his/its/their actions, judgment and advice as legal counsel to the
Company. Nevertheless, and fully understanding such potential conflicts, the
Subscriber hereby consents and agrees to such dual relationships and waives any
claim for any actual or potential breach of ethical obligations or professional
responsibility to the Company and/or its members by Mr. Barth, Foley Ventures
and/or other Foley & Lardner LLP partners with respect to such dual
relationships. The Subscriber further acknowledges that, in the event there is a
dispute between the Company and any of its members in the future, the personal
financial interest of Mr. Barth, Foley Ventures and/or other Foley & Lardner LLP
partners in his/its/their capacity as a member and investor in the Company in
any such dispute and/or the possibility of Mr. Barth, Foley Ventures and/or
other Foley & Lardner LLP partners being called as a witness in his/its/their
capacity as a member and investor in the Company may preclude Foley & Lardner
LLP and/or Mr. Barth from representing the Company in such dispute.

 

[Signature Page to the Subscription Agreement Follows]

 

 

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incontrol medical, llc

 

SIGNATURE PAGE TO MEMBERSHIP UNIT SUBSCRIPTION AGREEMENT

Date:

August 1, 2017                            

 

$2,500,000

Total Purchase Price

[*****]

Total Membership Units (Total Purchase Price divided by $[*****] per Unit
purchase price)

 

 

 

Type of Ownership:

 

❑

Individual

❑

Joint Tenants with Right of Survivorship

❑

Tenants in Common (if this option is chosen, specify percentage of ownership for
each owner).

         

                %

                         %         Print Name      

Print Name

❑

Trust

☒

Other      Corporation

 

 

NAME(S) IN WHICH MEMBERSHIP UNITS AND WARRANT ARE TO BE REGISTERED:

 

VIVEVE MEDICAL, INC.

(Please clearly print on the line above, the name(s) in which this investment
should be registered)

 

By:  Scott Durbin                                         

(Please Print)

 

 

Signature:

  /s/ Scott Durbin

 

Soc. Sec. No or Tax ID:

 

 

Mailing Address:                150 Commercial Street

Sunnyvale, CA 94086

___________________

 

Tel. No.:      (___) ___-________

 

Fax. No.:     (___) ___-________

 

Email:          ________________