Document:

ex10-1.htm

Exhibit 10.1

 

WAIVER AND FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT

 

This Waiver and First Amendment to Loan and Security Agreement (this “Amendment”) is entered into as of January 13, 2017, by and between WESTERN ALLIANCE BANK, an Arizona corporation (“Bank”) and VIVEVE MEDICAL, INC., a Delaware corporation (“Parent”), and VIVEVE, INC., a Delaware corporation (“Viveve”) (individually and collectively, jointly and severally, “Borrower”).

 

RECITALS

 

Borrower and Bank are parties to that certain Loan and Security Agreement dated as of June 20, 2016, as amended from time to time (the “Agreement”). The parties desire to amend the Agreement in accordance with the terms of this Amendment.

 

Borrower is currently in default pursuant to Section 8.2(a) of the Agreement due to Borrower’s failure to comply with the Performance to Plan; Minimum Cash covenant set forth in Section 6.8 of the Agreement for the measuring periods ending October 31, 2016 and November 30, 2016 (the “Existing Covenant Default”).

 

NOW, THEREFORE, the parties agree as follows:

 

1.     The following defined term in Section 1.1 of the Agreement hereby is amended and restated as follows:

 

“Final Payment Percentage” is four percent (4.00%).

 

2.     Section 6.8 of the Agreement hereby is amended and restated in its entirety to read as follows:

 

“6.8     Financial Covenants.

 

(a)     Performance to Plan. Borrower’s actual trailing three-month revenues, as of any date of determination, shall be no less than eighty percent (80%) of Borrower’s projected revenues (the “Revenue Covenant”), delivered to Bank prior to the Closing Date and dated March 3, 2016 (for such measurement periods through December 31, 2016; Projections for periods thereafter shall be delivered to and approved in writing by Bank, provided that such updated Projections shall be delivered to Bank no later than January 31 of each year during the term hereof); provided that Borrower shall not be required to comply with the Revenue Covenant as long as Borrower at all times maintains a ratio of (i) minimum unrestricted cash in accounts with Bank to (ii) Indebtedness, of at least 1.25 to 1.00.

 

(b)     Minimum Liquidity.     At all times until Borrower maintains a ratio of (i) minimum unrestricted cash in accounts with Bank to (ii) Indebtedness, of at least 1.25 to 1.00, Borrower shall maintain at all times unrestricted cash in accounts with Bank in an amount equal to or greater than Two Million Dollars ($2,000,000) (it being understood and agreed that once the Borrower achieves a ratio of (i) minimum unrestricted cash in accounts with Bank to (ii) Indebtedness, of at least 1.25 to 1.00, this Section 6.8(b) shall no longer apply, notwithstanding that such ratio is not achieved in any future period).”

 

3.     Exhibit C of the Agreement hereby is replaced with Exhibit C attached hereto.

 

4.     Borrower hereby acknowledges and Bank hereby waives the Existing Covenant Default, as well as any Event of Default pursuant to Section 8.8 resulting from Borrower’s misrepresentation that no Default or Event of Default existed under the Agreement in connection with the Existing Covenant Default (collectively, the “Designated Defaults”).

 

5.     Except for the waiver of the Designated Defaults under this Amendment, no course of dealing on the part of Bank or its officers, nor any failure or delay in the exercise of any right by Bank, shall operate as a waiver thereof, and any single or partial exercise of any such right shall not preclude any later exercise of any such right with respect to any Event of Default, other than the Designated Defaults. Except as expressly provided herein, Bank’s failure at any time to require strict performance by Borrower of any provision shall not affect any right of Bank thereafter to demand strict compliance and performance. Any suspension or waiver of a right must be in writing signed by an officer of Bank.

 

 

 

 

 

 

6.     Unless otherwise defined, all initially capitalized terms in this Amendment shall be as defined in the Agreement. The Agreement, as amended hereby, shall be and remain in full force and effect in accordance with its respective terms and hereby is ratified and confirmed in all respects. Except as expressly set forth herein, the execution, delivery, and performance of this Amendment shall not operate as a waiver of, or as an amendment of, any right, power, or remedy of Bank under the Agreement, as in effect prior to the date hereof.

 

7.     Borrower represents and warrants that the Representations and Warranties contained in the Agreement are true and correct as of the date of this Amendment, and that, after giving effect to this Amendment, no Event of Default has occurred and is continuing.

 

8.     As a condition to the effectiveness of this Amendment, Bank shall have received, in form and substance satisfactory to Bank, the following:

 

(a)     this Amendment, duly executed by Borrower;

 

(b)     a Certificate of the Secretary of Borrower with respect to incumbency and resolutions authorizing the execution and delivery of this Amendment; and

 

(c)     all reasonable Bank Expenses incurred through the date of this Amendment, which may be debited from any of Borrower's accounts.

 

9.     This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one instrument.

 

 

 

[Balance of Page Intentionally Left Blank]

 

 

 

 

 

 

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first date above written.

 

	
Viveve Medical, Inc., a Delaware corporation

 

 

By: /s/ Scott Durbin                                      

 

Name: Scott Durbin                                     

 

Title: CFO                                                       

 

 

 

Viveve, Inc., a Delaware corporation

 

 

By: /s/ Scott Durbin                                       

 

Name: Scott Durbin                                       

 

Title: CFO                                                        

 

 

 
	  	  
	
Western Alliance Bank, an Arizona corporation

 

  

By: /s/ Bill Wickline                                         

 

Name: Bill Wickline                                          

 

Title: VP, Director of Portfolio Management
	  	  
	  	  	  

 

 

 

 

 

[Signature Page to First Amendment to Loan and Security Agreement]

 

 

 

 

 

 

Exhibit C

 

Compliance Certificate

 

	
TO:
	
WESTERN ALLIANCE BANK, an Arizona corporation

 

	
FROM:
	
VIVEVE MEDICAL, INC., for itself and on behalf of VIVEVE, INC.

 

The undersigned authorized officer of VIVEVE MEDICAL, INC., for itself and on behalf of VIVEVE, INC., hereby certifies that in accordance with the terms and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”), (i) Borrower is in complete compliance for the period ending _______________ with all required covenants except as noted below and (ii) all representations and warranties of Borrower stated in the Agreement are true and correct in all material respects as of the date hereof, provided, however, those representations and warranties expressly referring to a particular date are true and correct in all material respects as of such date. Attached herewith are the required documents supporting the above certification. The Officer further certifies that these are prepared in accordance with Generally Accepted Accounting Principles (GAAP) and are consistently applied from one period to the next except as explained in an accompanying letter or footnotes.

 

Please indicate compliance status by circling Yes/No under “Complies” column.

 

	
Reporting Covenant
	
Required
	
Complies

	  	  	  	  
	
Annual financial statements (CPA Audited)
	
FYE within 90 days
	
Yes
	
No

	  	  	  	  
	
Monthly financial statements and Compliance Certificate
	
Prior to each Credit Extension, and monthly within 30 days 
	
Yes
	
No

	  	  	  	  
	
10K and 10Q
	
(as applicable)
	
Yes
	
No

	  	  	  	  
	
Annual operating budget, sales projections and operating plans approved by board of directors
	
Annually no later than January 31 of each fiscal year
	
Yes
	
No

	  	  	  	  
	
Deposit balances with Bank
	
$ ___________________
	  	  
	
Deposit balance outside Bank
	
$ ___________________
	  	  

	  	 	 	 
	Cash Covenant	Required	Actual	Complies
	 	 	 	 	 
	Unrestricted Cash to Indebtedness Ratio	At least 1.25 to 1.00	_____ to 1.00	Yes	No
	 	 	 	 	 
	If “No” to Cash Covenant Compliance then complete the following:	 	 	 	 
	 	 	 	 	 
	Revenue Covenant	Required	Actual	Complies
	  	  	  	  	  
	
Performance to Plan (monthly; T3M)
	
At least 80% of projections (dated 3/3/2016 for measurement periods through 12/31/16)
	
%
	
Yes
	
No

	
Minimum Liquidity
	
At least $2,000,000
	
$___________
	
Yes
	
No

	  	  	  	  	  

 

 

 

 

 

 

	
Comments Regarding Exceptions: See Attached.
	
BANK USE ONLY

	  	  
	  	
Received by:   _________________________________________________

	
Sincerely,
	
AUTHORIZED SIGNER

	  	  
	  	
Date: ________________________________________________________

	  	  
	  	  
	
___________________________________________
	
Verified:   _____________________________________________________

	
SIGNATURE
	
AUTHORIZED SIGNER

	  	  
	
___________________________________________
	
Date: ________________________________________________________

	
TITLE
	 
	  	
Compliance Status
	
Yes           No

	
___________________________________________
	  
	
DATE
	  

 

 

 

 

 

 

 

Corporate Resolutions to Borrow

 

	
    Borrower:   VIVEVE MEDICAL, INC.
	Date:   January 13, 2017    

 

I, the undersigned Secretary or Assistant Secretary of VIVEVE MEDICAL, INC. (the “Corporation”), HEREBY CERTIFY that the Corporation is organized and existing under and by virtue of the laws of the State of Delaware.

 

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of the Certificate of Incorporation, as amended, and the Restated Bylaws of the Corporation, each of which is in full force and effect on the date hereof.

 

I FURTHER CERTIFY that at a meeting of the Directors of the Corporation, duly called and held, at which a quorum was present and voting (or by other duly authorized corporate action in lieu of a meeting), the following resolutions (the “Resolutions”) were adopted.

 

 

 

 

 

 

BE IT RESOLVED, that any one (1) of the following named officers, employees, or agents of this Corporation, whose actual signatures are shown below:

 

	
NAMES
	 	
POSITION
	 	
ACTUAL SIGNATURES

	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  

acting for and on behalf of this Corporation and as its act and deed be, and they hereby are, authorized and empowered:

 

Borrow Money. To borrow from time to time from Western Alliance Bank, an Arizona corporation (“Bank”), on such terms as may be agreed upon between the officers, employees, or agents of the Corporation and Bank, such sum or sums of money as in their judgment should be borrowed, without limitation.

 

Execute Loan Documents. To execute and deliver to Bank that certain Loan and Security Agreement dated as of June 20, 2016 (as amended from time to time, including by that certain First Amendment to Loan and Security Agreement dated as of January 13, 2017, the “Loan Agreement”) and any other agreement entered into between Corporation and Bank in connection with the Loan Agreement, including any amendments, all as amended or extended from time to time (collectively, with the Loan Agreement, the “Loan Documents”), and also to execute and deliver to Bank one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for the Loan Documents, or any portion thereof.

 

Grant Security. To grant a security interest to Bank in the Collateral described in the Loan Documents, which security interest shall secure all of the Corporation’s Obligations, as described in the Loan Documents.

 

Negotiate Items. To draw, endorse, and discount with Bank all drafts, trade acceptances, promissory notes, or other evidences of indebtedness payable to or belonging to the Corporation or in which the Corporation may have an interest, and either to receive cash for the same or to cause such proceeds to be credited to the account of the Corporation with Bank, or to cause such other disposition of the proceeds derived therefrom as they may deem advisable.

 

Warrants. To issue Bank warrants to purchase the Corporation’s capital stock.

 

Letters of Credit. To execute letter of credit applications and other related documents pertaining to Bank’s issuance of letters of credit.

 

Corporate Credit Cards. To execute corporate credit card applications and agreements and other related documents pertaining to Bank’s provision of corporate credit cards.

 

Further Acts. In the case of lines of credit, to designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

 

 

 

 

 

 

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and Bank may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by Bank. Any such notice shall not affect any of the Corporation’s agreements or commitments in effect at the time notice is given.

 

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for the Corporation, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Corporation; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

 

IN WITNESS WHEREOF, I have hereunto set my hand on the date set forth above and attest that the signatures set opposite the names listed above are their genuine signatures.

 

	  	  	
CERTIFIED AND ATTESTED BY:

	  	  	  
	  	  	  
	  	  	
X _____________________________________

	  	  	
Secretary or Assistant Secretary of Borrower

	  	  	  

 

 

 

 

 

ATTACHMENT A

CERTIFICATE OF INCORPORATION

 

 

 

 

 

ATTACHMENT B

BYLAWS OF THE CORPORATION

 

 

 

 

 

  

Corporate Resolutions to Borrow

 

	
    Borrower:   VIVEVE, INC.
	Date:   January 13, 2017    

 

I, the undersigned Secretary or Assistant Secretary of VIVEVE, INC. (the “Corporation”), HEREBY CERTIFY that the Corporation is organized and existing under and by virtue of the laws of the State of Delaware.

 

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of the Certificate of Incorporation, as amended, and the Restated Bylaws of the Corporation, each of which is in full force and effect on the date hereof.

 

I FURTHER CERTIFY that at a meeting of the Directors of the Corporation, duly called and held, at which a quorum was present and voting (or by other duly authorized corporate action in lieu of a meeting), the following resolutions (the “Resolutions”) were adopted.

 

 

 

 

 

 

BE IT RESOLVED, that any one (1) of the following named officers, employees, or agents of this Corporation, whose actual signatures are shown below:

 

	
NAMES
	 	
POSITION
	 	
ACTUAL SIGNATURES

	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  

acting for and on behalf of this Corporation and as its act and deed be, and they hereby are, authorized and empowered:

 

Borrow Money. To borrow from time to time from Western Alliance Bank, an Arizona corporation (“Bank”), on such terms as may be agreed upon between the officers, employees, or agents of the Corporation and Bank, such sum or sums of money as in their judgment should be borrowed, without limitation.

 

Execute Loan Documents. To execute and deliver to Bank that certain Loan and Security Agreement dated as of June 20, 2016 (as amended from time to time, including by that certain First Amendment to Loan and Security Agreement dated as of January 13, 2017, the “Loan Agreement”) and any other agreement entered into between Corporation and Bank in connection with the Loan Agreement, including any amendments, all as amended or extended from time to time (collectively, with the Loan Agreement, the “Loan Documents”), and also to execute and deliver to Bank one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for the Loan Documents, or any portion thereof.

 

Grant Security. To grant a security interest to Bank in the Collateral described in the Loan Documents, which security interest shall secure all of the Corporation’s Obligations, as described in the Loan Documents.

 

Negotiate Items. To draw, endorse, and discount with Bank all drafts, trade acceptances, promissory notes, or other evidences of indebtedness payable to or belonging to the Corporation or in which the Corporation may have an interest, and either to receive cash for the same or to cause such proceeds to be credited to the account of the Corporation with Bank, or to cause such other disposition of the proceeds derived therefrom as they may deem advisable.

 

Letters of Credit. To execute letter of credit applications and other related documents pertaining to Bank’s issuance of letters of credit.

 

Corporate Credit Cards. To execute corporate credit card applications and agreements and other related documents pertaining to Bank’s provision of corporate credit cards.

 

Further Acts. In the case of lines of credit, to designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

 

 

 

 

 

 

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and Bank may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by Bank. Any such notice shall not affect any of the Corporation’s agreements or commitments in effect at the time notice is given.

 

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for the Corporation, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Corporation; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

 

IN WITNESS WHEREOF, I have hereunto set my hand on the date set forth above and attest that the signatures set opposite the names listed above are their genuine signatures.

 

	  	  	
CERTIFIED AND ATTESTED BY:

	  	  	  
	  	  	  
	  	  	
X ___________________________________

	  	  	
Secretary or Assistant Secretary of Borrower

	  	  	  

 

 

 

 

 

ATTACHMENT A

CERTIFICATE OF INCORPORATION

 

 

 

 

 

ATTACHMENT B

BYLAWS OF THE CORPORATIONExhibit 10.1

 

PURCHASE AGREEMENT

 

This Purchase Agreement (the “Agreement”) is made as of the 12th day of January, 2017 (the “Effective Date”), by and between Retractable Technologies, Inc. (the “Company”), a Texas corporation, and Thomas J. Shaw (the “Purchaser”).

 

WHEREAS, on the terms and subject to the conditions set forth in this Agreement, the Company desires to issue and sell to the Purchaser, and the Purchaser desires to purchase from the Company, Two Million (2,000,000) shares of the Company’s common stock, no par value (the “Common Stock”), as set forth in this Agreement; and

 

NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement, the Company and the Purchaser agree as follows:

 

SECTION 1.                         Authorization of Sale of the Shares.  Subject to the terms and conditions of this Agreement, the Company has authorized the issuance and sale of up to Three Million (3,000,000) shares (the “Shares”) of Common Stock.

 

SECTION 2.                         Agreement to Sell and Purchase the Shares.  At the Closing (as defined in Section 3), the Company will, subject to the terms of this Agreement, issue and sell to the Purchaser, and the Purchaser will buy from the Company, upon the terms and conditions hereinafter set forth, Two Million (2,000,000) Shares at Eighty-Nine Cents ($0.89) per share, the closing price of the Shares on the Effective Date, for an aggregate purchase price of One Million Seven Hundred Eighty Thousand Dollars ($1,780,000.00).

 

SECTION 3.                         Delivery of the Shares at the Closing.  The completion of the purchase and sale of the Shares (the “Closing”) shall occur at the offices of Krage & Janvey, L.L.P., 2100 Ross Avenue, Suite 2600, Dallas, TX 75201, simultaneously with the execution of this Agreement, or on such later date or at such different location as the parties shall agree (the date on which the Closing occurs, the “Closing Date”).

 

At the Closing, the Purchaser shall deliver, in immediately available funds, the full amount of the purchase price for the Shares being purchased and the Company shall deliver to the Purchaser, one or more stock certificates registered in the name of the Purchaser, or in such nominee name(s) as designated by the Purchaser in writing, and bearing an appropriate legend referring to the fact that the Shares were sold in reliance upon the exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(a)(2) thereof and Rule 506 thereunder.

 

SECTION 4.                         Representations, Warranties, and Covenants of the Company.  The Company hereby represents and warrants to and covenants with the Purchaser as follows:

 

4.1                               Organization and Qualification.  The Company is a corporation duly incorporated, validly existing, and in good standing under the laws of the state of Texas and the Company is qualified to do business as a foreign corporation in each jurisdiction in which qualification is required.

 

4.2                               Issuance, Sale, and Delivery of the Shares.  The issuance and sale of the Shares have been duly authorized by the Company and the Shares, when issued, delivered and paid for in the manner set forth in this Agreement, will be validly issued, fully paid and nonassessable.  No preemptive rights, commitments, rights of first offer or refusal, anti-dilution rights, rights of participation or any other rights to subscribe for or purchase any shares of Common Stock of the Company exist with respect to the issuance and sale of the Shares by the Company pursuant to this Agreement.  No further approval or authority of the Company’s stockholders or the Board of Directors of the Company (the “Board”) will be required for the issuance and sale of the Shares to be sold by the Company as contemplated herein.

 

4.3                               Due Execution, Delivery, and Performance of this Agreement.  The Company has full legal right, corporate power, and authority to enter into this Agreement and perform the transactions contemplated hereby.  This Agreement has been duly authorized, executed, and delivered by the Company.  This Agreement constitutes a legal, valid, and binding agreement of the Company, enforceable against the Company in accordance

 

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with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or other laws of general application relating to or affecting the enforcement of creditors’ rights and the application of equitable principles relating to the availability of remedies.  The execution and performance of this Agreement by the Company and the consummation of the transactions herein contemplated will not violate any provision of the certificate of incorporation or bylaws of the Company and will not result in the creation of any lien, charge, security interest, or encumbrance upon any assets of the Company pursuant to the terms or provisions of, or will not conflict with, result in the breach or violation of, or constitute, either by itself, or upon notice or the passage of time or both, a default under any material agreement, mortgage, deed of trust, lease, franchise, license, indenture, permit, or other instrument to which any of the Company is a party or by which the Company may be bound or affected, any material statute or any authorization, judgment, decree, order, rule, or regulation of any court or any regulatory body, administrative agency or other governmental agency or body applicable to the Company.  No consent, approval, authorization, or other order of any court, regulatory body, administrative agency or other governmental agency or body is required for the execution and delivery of this Agreement or the consummation of the transactions contemplated by this Agreement, except for compliance with the blue sky laws and federal securities laws applicable to the offering of the Shares and such as may be required by the NYSE MKT.

 

4.4                               Brokers and Finders.  No brokerage or finder’s fees or commissions are, or will be, payable by the Company to any broker, financial advisor, or consultant, finder, placement agent, investment banker, bank, or other Person with respect to the transactions contemplated hereby.

 

SECTION 5.                         Representations, Warranties and Covenants of the Purchaser. Purchaser represents and warrants to, and covenants with, the Company that:

 

5.1                               Experience. (i) The Purchaser is knowledgeable, sophisticated and experienced in financial and business matters and is qualified to make decisions with respect to investments in shares representing an investment decision like that involved in the purchase of the Shares, including investments in securities issued by the Company and comparable entities, has the ability to bear the economic risks of an investment in the Shares; (ii) the Purchaser is acquiring the Shares for his own account, for investment only, and with no present intention of distributing any of such Shares, or any arrangement or understanding with any other Person, regarding the distribution of such Shares (this representation and warranty not limiting the Purchaser’s right to sell in compliance with the Securities Act and the rules and regulations of the Commission promulgated thereunder); (iii) the Purchaser will not, directly or indirectly, offer, sell, pledge, transfer, or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Shares, nor will the Purchaser engage in any short sale that results in a disposition of any of the Shares, except in compliance with the Securities Act and the rules and regulations of the Commission promulgated thereunder and any applicable state securities laws; (iv) the Purchaser will comply with the applicable requirements of any exemption from the Securities Act; (v) the Purchaser is an “accredited investor” within the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act; and (vi) as the chief executive officer of the Company, the Purchaser is well acquainted with the operations and risks of the Company.

 

5.2                               Reliance on Exemptions.  The Purchaser understands that the Shares are being offered and sold to him in reliance upon specific exemptions from the registration requirements of the Securities Act, the rules and regulations of the Commission promulgated thereunder and state securities laws and that the Company is relying upon the truth and accuracy of, and the Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Purchaser set forth herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the Shares.

 

5.3                               Confidentiality.  The Purchaser agrees to keep confidential all information concerning this private placement. The Purchaser acknowledges that he is prohibited from reproducing or distributing this Agreement, or any other offering materials, or other information provided by the Company in connection with the Purchaser’s consideration of his investment in the Company, in whole or in part, or divulging or discussing any of their contents, except to his financial, investment, or legal advisors in connection with his proposed investment in the Shares.  The Purchaser understands that the federal securities laws impose restrictions on trading based on material, non-public information.  These confidentiality obligations will terminate upon the earlier of (i) filing by the Company of a press release or press releases and a report or reports pursuant to the Exchange Act, describing this offering and/or containing a copy of this Agreement and related materials or (ii) 10 days after the date of this

 

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Agreement.  The foregoing agreements shall not apply to any information that is, or becomes, publicly available through no fault of the Purchaser,  or that the Purchaser is legally required to disclose; provided, however, that if the Purchaser is requested or ordered to disclose any such information pursuant to any court or other government order, or any other applicable legal procedure, he shall, if practicable, provide the Company with prompt notice of any such request or order in time sufficient to enable the Company to seek an appropriate protective order.

 

5.4                               Investment Decision.  The Purchaser understands that nothing in the Agreement, or any other materials presented to the Purchaser in connection with the purchase and sale of the Shares, constitutes legal, tax, or investment advice.

 

5.5                               Risk of Loss.  The Purchaser understands that his investment in the Shares involves a significant degree of risk, including a risk of total loss of the Purchaser’s investment, and the Purchaser has full cognizance of, and understands the risk factors related to, the Purchaser’s purchase of the Shares, including, but not limited to, those set forth under the caption “Risk Factors” in the Annual Report on Form 10-K filed by the Company with the Commission on March 30, 2016.  The Purchaser understands that the market price of the Common Stock has been volatile and that no representation is being made as to the future value of the Common Stock.

 

5.6                               Legend.  The Purchaser understands that, until such time as a registration statement as to the Shares has been declared effective, or the Shares may be sold pursuant to Rule 144 under the Securities Act without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Shares will bear a restrictive legend in substantially the following form: “THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THESE SHARES UNDER THE SECURITIES ACT OF 1933 OR AN OPINION OF THE COMPANY’S COUNSEL THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.”

 

5.7                               Organization; Validity; Enforcements.  The Purchaser further represents and warrants to, and covenants with, the Company that (i) the Purchaser has full right, power, authority, and capacity to enter into this Agreement and to consummate the transactions contemplated hereby, (ii) the making and performance of this Agreement by the Purchaser and the consummation of the transactions herein contemplated will not conflict with, result in the material breach or violation of, or constitute, either by itself or upon notice or the passage of time or both, a default under any material agreement, mortgage, deed of trust, lease, franchise, license, indenture, permit, or other instrument to which the Purchaser is a party or, any statute, or any authorization, judgment, decree, order, rule, or regulation of any court or any regulatory body, administrative agency, or other governmental agency, or body applicable to the Purchaser, (iii) no consent, approval, authorization, or other order of any court, regulatory body, administrative agency, or other governmental agency or body is required on the part of the Purchaser for the execution and delivery of this Agreement or the consummation of the transactions contemplated by this Agreement, (iv) upon the execution and delivery of this Agreement, this Agreement shall constitute a legal, valid and binding obligation of the Purchaser, enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or other laws of general application relating to, or the enforcement of, creditor’s rights and the application of equitable principles relating to the availability of remedies, and (v) there is not in effect any order enjoining or restraining the Purchaser from entering into, or engaging in, any of the transactions contemplated by this Agreement.

 

SECTION 6.                         Notices.  All notices, requests, consents, and other communications hereunder shall be in writing, shall be mailed by first class mail, overnight carrier, or hand delivery, and shall be deemed given when so delivered and shall be delivered as addressed as follows:

 

(a)                                 if to the Company, to:

 

Retractable Technologies, Inc.

511 Lobo Lane

Little Elm, TX 75068

Attn: Mr. Douglas W. Cowan

 

3

 

With a copy to:

 

Krage & Janvey, L.L.P.

2100 Ross Avenue

Suite 2600

Dallas, TX 75201

Attn: Valerie P. Thomas, Esq.

 

or to such other person at such other place as the Company shall designate to the Purchaser in writing; and

 

(b)                                 if to the Purchaser, to:

 

Mr. Thomas J. Shaw

511 Lobo Lane

Little Elm, TX 75068

 

or to such other person at such other place as the Purchaser shall designate to the Company in writing.

 

SECTION 7.                         Changes; Waiver.  This Agreement may not be modified or amended, and no provision of this Agreement may be waived, except pursuant to an instrument in writing signed by the Company and the Purchaser or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought.  Any amendment or waiver effected in accordance with this Section 7 shall be binding upon the holder of any securities purchased under this Agreement, each future holder of all such securities, and the Company.  No waiver of any default, with respect to any provision, condition, or requirement of this Agreement will be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor will any delay or omission of any party to exercise any right hereunder, in any manner, impair the exercise of any such right.

 

SECTION 8.                         Headings.  The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be part of this Agreement.

 

SECTION 9.                         Severability.  In case any provision contained in this Agreement should be invalid, illegal, or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.

 

SECTION 10. Texas Law to Apply. THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS (EXCLUDING ANY CONFLICTS-OF-LAW RULE OR PRINCIPLE OF TEXAS LAW THAT MIGHT REFER THE GOVERNANCE, CONSTRUCTION OR INTERPRETATION OF THIS AGREEMENT TO THE LAWS OF ANOTHER STATE).

 

SECTION 11.                  WAIVER OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY.

 

SECTION 12.                  Counterparts.  This Agreement may be executed in multiple counterparts, as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this Agreement.  Facsimile signatures or signatures received as a pdf attachment to electronic mail shall be treated as original signatures for all purposes of this Agreement.

 

SECTION 13.                  Entire Agreement.  This Agreement and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Purchaser makes any representation, warranty, covenant, or

 

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undertaking with respect to such matters.  Each party expressly represents and warrants that it is not relying on any oral or written representations, warranties, covenants, or agreements outside of this Agreement.

 

SECTION 14.                  Fees and Expenses.  The Company and the Purchaser shall pay their own respective fees and expenses related to the transactions contemplated by this Agreement.

 

SECTION 15.                  Further Assurances.  Each party agrees to cooperate fully with the other party and to execute such further instruments, documents, and agreements and to give such further written assurance as may be reasonably requested by the other party to evidence and reflect the transactions described herein and contemplated hereby and to carry into effect the intents and purposes of this Agreement.

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.

 

	
 
    	
RETRACTABLE TECHNOLOGIES, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Douglas W. Cowan
    
	
 
    	
 
    	
Name:
    	
Douglas W. Cowan
    
	
 
    	
 
    	
Title:
    	
Vice President and Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
/s/ Thomas J. Shaw
    
	
 
    	
THOMAS J. SHAW
    
	
 
    	
State of Residence: Texas
    

 

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