Exhibit 10.29
SUBSCRIPTION AGREEMENT
EchoCath, Inc.
P.O. Box 7224
Princeton, New Jersey 08543
Gentlemen:
1. Subscription. (a) The undersigned (sometimes referred to herein as the
"Subscriber"), intending to be legally bound, hereby irrevocably subscribes to
purchase from EchoCath, Inc., a New Jersey corporation (the "Company"), the
number of shares of Class A common stock, no par value per share (the "Common
Stock"), of the Company (the "Shares"), set forth on the signature page hereof,
for a purchase price of $0.75 per Share (the "Purchase Price"), provided the
Subscriber agrees to exercise one (1) Warrant (dated to expire either May 14,
2002 or October 29, 2002) (collectively, the "Warrants") to purchase shares of
Common Stock held by the Subscriber for every four (4) Shares purchased
hereunder.
(b) Subscription payments (which include the exercise of the Warrants
associated with the purchase of the Shares) should be made payable to "Buchanan
Ingersoll Professional Corporation, as escrow agent" and should be delivered to
Buchanan Ingersoll Professional Corporation, 650 College Road East, 4th Floor,
Princeton, NJ 08540, Attention: John F. Cinque, Esq., together with two executed
and properly completed copies of this Agreement (including the Notice of
Exercise for the Warrant) and a completed Investor Questionnaire. Wire transfers
should be made in accordance with the following instructions:
Wire Transfer Instructions
Wire to: Summit Bank, Kingston, NJ
Account Number: 999616722
SubAccount Number: ___________
ABA Number: 021202162
For the Credit of: Buchanan Ingersoll Professional Corporation
Attorney Trust Account
Sub Account: EchoCath, Inc.
The Company shall have the right to accept or reject this subscription in whole
or in part at any time prior to March 31, 2000. In any event, the Company shall
not accept any subscription unless and until the Company has received
subscriptions to purchase an aggregate of 600,000 Shares in the Offering. If the
subscription is not accepted in whole or in part by the Company, the full or
ratable amount, as the case may be, of any subscription payment received will be
promptly refunded to the subscriber without deduction therefrom or interest
thereon.
(c) If this subscription is accepted by the Company, in whole or in
part, the Company shall deliver to the undersigned the Shares subscribed for
hereby, dated the date of closing of such subscription, and a fully executed
copy of this Agreement. The Company may conduct multiple closings of the
Offering (each respective closing being referred to herein as the "Closing".)
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the undersigned as follows, in each case as of
the date hereof and as of the date of the Closing, except for any changes
resulting solely from the Offering:
(a) The Company is duly organized, validly existing and in good
standing under the laws of the State of New Jersey with full power and authority
to own, lease, license and use its properties and assets and to carry out the
business in which it is currently engaged.
(b) The Company has all requisite power and authority to: (i) execute,
deliver and perform its obligations under each this Agreement; and (ii) to issue
and sell the Shares. All necessary corporate proceedings of the Company have
been duly taken to authorize the execution and delivery of the Shares.
(c) The Shares are validly authorized, fully paid and nonassessable,
without any personal liability attaching to the ownership thereof, and will not
be issued in violation of any preemptive or other rights of shareholders.
(d) The execution and delivery of this Agreement, the issuance of the
Shares and the incurrence of the obligations herein set forth and the
consummation of the transactions herein contemplated, will not result in a
violation of, or constitute a default under, the certificate of incorporation or
by-laws, in the performance or observance of any material obligations,
agreement, covenant or condition contained in any bond, debenture, note or other
evidence of indebtedness to which the Company is a party or by which it or any
of its properties may be bound or in violation of any material order, rule,
regulations, writ, injunction, or decree of any government, governmental
instrumentality or court, domestic or foreign.
3. Representations and Warranties of the Subscriber. The undersigned hereby
represents and warrants to, and agrees with, the Company as follows:
(a) If a natural person, the undersigned is: a bona fide resident of
the State contained in the address set forth on the signature page of this
Agreement as the undersigned's home address; at least 21 years of age; and
legally competent to execute this Agreement. If an entity, the undersigned is
duly authorized to execute this Agreement and this Agreement constitutes the
legal, valid and binding obligation of the undersigned enforceable against the
undersigned in accordance with its terms.
(b) The undersigned has received, read carefully and is familiar with
this Agreement. Respecting the Company, the undersigned is familiar with the
Company's business, plans and financial condition, the terms of the Offering and
any other matters relating to the Offering; the undersigned has received all
materials which have been requested by the
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undersigned; has had a reasonable opportunity to ask questions of the Company
and its representatives; and the Company has answered all inquiries that the
undersigned or the undersigned's representatives have put to it. The undersigned
has had access to all additional information necessary to verify the accuracy of
the information set forth in this Agreement and any other materials furnished
herewith, and has taken all the steps necessary to evaluate the merits and risks
of an investment as proposed hereunder.
(c) The undersigned or the undersigned's purchaser representative has
such knowledge and experience in finance, investments and other business matters
so as to be able to protect the interests of the undersigned in connection with
this transaction, and the undersigned's investment in the Company hereunder is
not material when compared to the undersigned's total financial capacity.
(d) The undersigned understands the various risks of an investment in
the Company as proposed herein and can afford to bear such risks, including,
without limitation, the risks of losing the entire investment.
(e) The undersigned acknowledges that no market for the Shares
presently exists and none may develop in the future and that the undersigned may
find it impossible to liquidate the investment at a time when it may be
desirable to do so, or at any other time.
(f) The undersigned has been advised by the Company that none of the
Shares have been registered under the Securities Act of 1933, as amended (the
"Act"), that the Shares will be issued on the basis of the statutory exemption
provided by Section 4(2) of the Act or Regulation D promulgated thereunder, or
both, relating to transactions by an issuer not involving any public offering
and under similar exemptions under certain state securities laws, that this
transaction has not been reviewed by, passed on or submitted to any Federal or
state agency or self-regulatory organization where an exemption is being relied
upon, and that the Company's reliance thereon is based in part upon the
representations made by the undersigned in this Agreement. The undersigned
acknowledges that the undersigned has been informed by the Company of, or is
otherwise familiar with, the nature of the limitations imposed by the Act and
the rules and regulations thereunder on the transfer of Shares. In particular,
the undersigned agrees that no sale, assignment or transfer of any of the Shares
shall be valid or effective, and the Company shall not be required to give any
effect to such a sale, assignment or transfer, unless (i) the sale, assignment
or transfer of such Shares is registered under the Act, it being understood that
the Shares are not currently registered for sale and that the Company has no
obligation or intention to so register the Shares, or (ii) such Shares are sold,
assigned or transferred in accordance with all the requirements and limitations
of Rule 144 under the Act, it being understood that Rule 144 is not available at
the present time for the sale of the Shares, or (iii) such sale, assignment or
transfer is otherwise exempt from registration under the Act. The undersigned
further understands that an opinion of counsel and other documents may be
required to transfer the Shares. The undersigned acknowledges that the Shares
shall be subject to a stop transfer order and the certificate or certificates
evidencing any Shares shall bear the following or a substantially similar legend
or such other legend as may appear on the forms of Warrants and such other
legends as may be required by state Shares or blue sky laws:
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"The Shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"), or any state securities laws and neither such Shares
nor any interest therein may be offered, sold, pledged,
assigned or otherwise transferred unless (1) a registration
statement with respect thereto is effective under the Act and
any applicable state securities laws, or (2) the Company
receives an opinion of counsel to the holder of such Shares,
which counsel and opinion are reasonably satisfactory to the
Company, that such Shares may be offered, sold, pledged,
assigned or transferred in the manner contemplated without an
effective registration statement under the Act or applicable
state securities laws."
(g) The undersigned will acquire the Shares for the undersigned's own
account (or for the joint account of the undersigned and the undersigned's
spouse either in joint tenancy, tenancy by the entirety or tenancy in common)
for investment and not with a view to the sale or distribution thereof or the
granting of any participation therein, and has no present intention of
distributing or selling to others any of such interest or granting any
participation therein.
(h) It never has been represented, guaranteed or warranted by any
broker, the Company, any of the officers, directors, shareholders, partners,
employees or agents of either, or any other persons, whether expressly or by
implication, that:
(i) the Company or the undersigned will realize any given
percentage of profits and/or amount or type of consideration, profit or
loss as a result of the Company's activities or the undersigned's
investment in the Company; or
(ii) the past performance or experience of the management of the
Company, or of any other person, will in any way indicate the predictable
results of the ownership of the Shares or of the Company's activities.
(i) The undersigned is not subscribing for Shares as a result of or
subsequent to any advertisement, article, notice or other communication
published in any newspaper, magazine or similar media or broadcast over
television or radio, or presented at any seminar or meeting, or any solicitation
of a subscription by a person other than a representative of the Company with
which the undersigned had a pre-existing relationship in connection with
investments in Shares generally.
(j) The undersigned is not relying on the Company with respect to the
tax and other economic considerations of an investment.
(k) Without limiting any of the undersigned's other representations and
warranties hereunder, the undersigned acknowledges that the undersigned has
reviewed and is aware of the risk factors described in the Company's
Registration Statement on Form S-3 (Reg. No. 333-95609) declared effective on
February __, 2000.
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(l) The undersigned acknowledges that the representations,
warranties and agreements made by the undersigned herein shall survive the
execution and delivery of this Agreement and the purchase of the Shares.
4. Concerning the Escrow Agent. To induce Buchanan Ingersoll Professional
Corporation to serve as the Escrow Agent and to act in such capacity hereunder,
the Company and the Escrow Agent have entered into a separate agreement (the
"Escrow Agreement"), relating to the proceeds of the Offering, a copy of which
is annexed hereto as Exhibit A. In connection therewith, it is further agreed by
the parties hereto that:
(a) The Escrow Agent shall not be liable, except for its own gross
negligence or willful misconduct and, except with respect to claims based upon
such gross negligence or willful misconduct that are successfully asserted
against the Escrow Agent, the undersigned and the Company hereby agree to
jointly and severally indemnify and hold harmless the Escrow Agent from and
against any and all losses, liabilities, claims, actions, damages and expenses,
including, without limitation, reasonable attorneys' fees and disbursements,
arising out of or in connection with this Escrow Agreement.
(b) The Subscriber understands and agrees that, notwithstanding its
duties as Escrow Agent under the Escrow Agreement, the Escrow Agent is legal
counsel to the Company, and, accordingly, neither any services provided by the
Escrow Agent as Escrow Agent nor any provisions of the Escrow Agreement, either
express or implied, shall restrict or inhibit the Escrow Agent in any way from
representing the Company or its affiliates in any action, dispute, controversy,
arbitration, suit or negotiation arising under this Agreement, the Escrow
Agreement or under any other agreement or in any manner or context whatsoever,
whether or not directly or indirectly involving the Company or its affiliates.
5. Indemnification. The undersigned acknowledges that the undersigned
understands the meaning and legal consequences of the representations and
warranties contained in Section 3 hereof, and agrees to indemnify and hold
harmless the Company, its officers, directors, partners, employees, agents and
controlling persons thereof, past, present or future, from and against any and
all loss, damage or liability due to or arising out of a breach of any such
representation or warranty.
6. Transferability. Neither this Agreement, nor any interest of the
undersigned herein, shall be assignable or transferable by the undersigned in
whole or in part except by operation of law.
7. Miscellaneous.
(a) This Agreement sets forth the entire understanding of the
parties with respect to the subject matter hereof, supersede all existing
agreements among them concerning such subject matter, and (subject to Section
7(g)) may be modified only by a written instrument duly executed by the party to
be charged.
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(b) Except as otherwise specifically provided herein, any notice or
other communication required or permitted to be given hereunder shall be in
writing and shall be mailed by certified mail, return receipt requested, or by
Federal Express, Express Mail or similar overnight delivery or courier service
or delivered (in person or by telecopy, telex or similar telecommunications
equipment) against receipt to the party to whom it is to be given, (i) if to the
Company, at the address set forth on the first page hereof, (ii) if to the
undersigned, at the address set forth on the signature page hereof, or (iii) in
either case, to such other address as the party shall have furnished in writing
in accordance with the provisions of this Section 7(b). Notice to the estate of
any party shall be sufficient if addressed to the party as provided in this
Section 7(b). Any notice or other communication given by certified mail shall be
deemed given at the time of certification thereof, except for a notice changing
a party address which shall be deemed given at the time of receipt thereof. Any
notice given by other means permitted by this Section 7(b) shall be deemed given
at the time of receipt thereof.
(c) This Agreement shall be binding upon and inure to the benefit
of the parties hereto, the successors and assigns of the Company, and the
permitted successors, assigns, heirs and personal representatives of the
undersigned (including permitted transferees of the Shares).
(d) The headings in this Agreement are solely for convenience of
reference and shall be given no effect in the construction or interpretation of
this Agreement.
(e) This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
(f) This Agreement has been negotiated and shall be consummated in
the State of New Jersey and shall be governed by and construed in accordance
with the laws of the State of New Jersey, without giving effect to principles
governing conflicts of law.
(g) This Agreement does not create, and shall not be construed as
creating, any rights enforceable by any person not a party to this Agreement
(except as provided in Section 7(c)).
(h) The parties hereto irrevocably consent to the jurisdiction of
the courts of the State of New Jersey and of any federal court located in such
State in connection with any action or proceeding arising out of or relating to
this Agreement, any document or instrument delivered pursuant to, in connection
with or simultaneously with this Agreement, or a breach of this Agreement or any
such document or instrument. In any such action or proceeding, each party hereto
waives personal service of any summons, complaint or other process and agrees
that service thereof may be made in accordance with Section 7(b).
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year this subscription has been accepted by the Company as set forth
below.
Under penalties of perjury, by signing this signature page, the Subscriber
certifies that (i) the name, residence address and social security or taxpayer
identification number set forth below are true, correct and complete, and (ii)
the Subscriber is not subject to backup withholding and (a) the Subscriber is
exempt from backup withholding, or (b) the Subscriber has not been notified by
the Internal Revenue Service ("IRS") that he or it is subject to backup
withholding as a result of a failure to report all interest or dividends, or (c)
the IRS has notified the Subscriber that he or it is no longer subject to backup
withholding.
If you have been notified by the IRS that you are currently subject to
backup withholding because of under reporting interest or dividends on your tax
return cross-out (ii) above.
Number of Shares ___________________________________
Being Purchased Print Name of Subscriber
____________________________
Number of Warrants By:________________________________
Being Exercised (Signature of Subscriber
(equal to 1/4 of above) or Authorized Signatory)
____________________________
Notice of Exercise Attached Hereto
Social Security Number or other
Taxpayer Identification Number:
___________________________________
Address:___________________________
___________________________________
___________________________________
___________________________________
Telephone: ________________________
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If the Shares will be held as joint tenants,
tenants in common, or community property,
please complete the following:
____________________________________________
Print name of spouse or other co-subscriber
____________________________________________
Signature of spouse or other co-subscriber
____________________________________________
Print manner in which Shares will be held
____________________________________________
Social Security Number
ACCEPTED BY:
ECHOCATH, INC.
By: ____________________________________
Name: Frank A. DeBernardis
Title: Chief Executive Officer
Date: March ___, 2000
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