SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 20, 1998
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BIOJECT MEDICAL TECHNOLOGIES INC.
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(Exact Name of Registrant as Specified in Charter)
Oregon
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(State or Other Jurisdiction of Incorporation)
0-15360 93-1099680
- ------------------------ --------------------------------
(Commission File Number) (IRS Employer Identification No.)
7620 SW Bridgeport Road
Portland, Oregon 97224
- ------------------------------ -----------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (503) 639-7221
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N/A
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(Former Name or Former Address, if Changed Since Last Report)
Item 5.
The Special Meeting of Stockholders of Bioject Medical Technologies, Inc. was
convened at 1:00 p.m., on February 20, 1998, at the Company's headquarters,
7620 S.W. Bridgeport Road, Portland, Oregon.
There were 25,368,342 shares of Common Stock issued and outstanding on the
record date, December 23, 1997.
Of the total shares outstanding on the record date, there were 16,325,537
shares present at the meeting in person or by proxy, which is 64.35% of the
Common Stock entitled to vote, thereby constituting a quorom.
All of the proposals as set forth in the proxy statement for the Special
Meeting were approved. The voting recorded is as follows:
Proposal #1: The proposal to approve the exchange of a promissory
note in the original principal amount of $12.015 million
issued by the Company to Elan for approximately 832,000
shares of the Company's Series A and Series B Convertible
Preferred Stock received the following votes:
FOR AGAINST ABSTAIN
---------- ------- -------
15,964,575 214,940 146,022
Proposal #2: The proposal to approve the issuance of the Company's
Series C Convertible Preferred Stock or other similar
convertible preferred stock to Elan in connection with
future funding of glucose monitoring research and
development received the following votes:
FOR AGAINST ABSTAIN
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15,961,959 216,291 147,287
Proposal #3: The proposal to approve the issuance to Raphael, LLC, of
a warrant to purchase 100,000 shares of the Company's
Common Stock received the following votes:
FOR AGAINST ABSTAIN
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15,696,136 452,669 176,732
As a result of the passage of Proposal #1, the exchange of debt for Series A
and Series B convertible preferred stock was completed effective March 2,
1998.
Item 7. Exhibits
Attached hereto are the following exhibits:
99 Bioject Medical Technologies Inc. Consolidated Balance Sheet as
of January 31, 1998
10.47 Articles of Amendment to the Articles of Incorporation of Bioject
Medical Technologies Inc.
Signatures
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly
authorized.
DATED this 6th day of March, 1998
BIOJECT MEDICAL TECHNOLOGIES INC.
By /s/ Peggy J. Miller
Peggy J. Miller
Vice President, Chief
Financial Officer and Secretary
Exhibit Index- Exhibits included in this filing
Exhibit
Number Exhibit
99 Bioject Medical Technologies, Inc. Consolidated Balance Sheet
as of January 31, 1998, submitted pursuant to NASDAQ net tangible
assets requirements.
10.47 Articles of Amendment to the Articles of Incorporation of Bioject
Medical Technologies Inc.
Exhibit 99
BIOJECT MEDICAL TECHNOLOGIES INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
<TABLE>
January 31, Proforma January 31,
1998 Adjustments 1998
----------------------------------
ASSETS (unaudited) (pro-forma)
- ------------------------------------------
<S> <C> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 568,878 $ - $ 568,878
Securities available for sale 1,967,749 1,967,749
Accounts receivable 339,299 339,299
Inventories 1,710,414 1,710,414
Prepaid and other current assets 91,312 91,312
----------- -------- -----------
Total current assets 4,677,652 - 4,677,652
PROPERTY AND EQUIPMENT, at cost:
Machinery and equipment 2,233,429 2,233,429
Production molds 1,939,754 1,939,754
Furniture and fixtures 160,342 160,342
Leasehold improvements 94,115 94,115
----------- -------- ----------
4,427,640 - 4,427,640
Less - Accumulated depreciation (1,869,062) - (1,869,062)
----------- -------- -----------
2,558,578 - 2,558,578
OTHER ASSETS 331,201 - 331,201
----------- --------- ----------
$ 7,567,431 - $7,567,431
=========== ========= ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
- --------------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 352,115 $ - $ 352,115
Accrued payroll 161,775 161,775
Other accrued liabilities 184,360 184,360
Accrued interest 327,200 (327,200)(a) -
Deferred revenue 125,000 125,000
----------- --------- --------
Total current liabilities 1,150,450 (327,200)(a) 823,250
LONG-TERM DEBT 12,015,000 (12,015,000)(a) -
COMMITMENTS
SHAREHOLDERS' EQUITY:
Preferred stock, no par, 10,000,000
shares authorized; Series A - 7,827,200(a) 7,827,200
Series B - 1,515,000(a) 1,515,000
Common stock, no par, 100,000,000 shares
authorized; issued and outstanding
25,371,008 shares at January 31, 1998
actual, and proforma 44,299,581 3,000,000(a) 47,299,581
Accumulated deficit (49,897,600) (49,897,600)
----------- ----------- -----------
Total shareholders' equity (5,598,019) 12,342,200 6,744,181
----------- ---------- -----------
$ 7,567,431 $ - $ 7,567,431
=========== =========== ==========
</TABLE>
(a) Adjustment reflects the exchange of $12.015 million in debt plus
accrued interest for Series A and Series B convertible preferred
stock. The allocation of $3 million to common stock reflects an
inherent additional dividend which will be accreted to the preferred
stock on a straight-line basis over the period the preferred stock
will be outstanding through mandatory redemption in October
2004.
Exhibit 10.47
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
BIOJECT MEDICAL TECHNOLOGIES INC.
Pursuant to Sections 60.134 and 60.447 of the Oregon Business Corporation
Act, the undersigned corporation adopts the following Articles of Amendment
to its Articles of Incorporation:
FIRST: The name of the corporation is Bioject Medical Technologies Inc.
(the "Corporation").
SECOND: The following resolutions, designating the relative rights and
preferences of the Series A Convertible Preferred Stock, Series B Convertible
Preferred Stock and Series C Convertible Preferred Stock were duly adopted by
the directors of the Corporation on December 4, 1997, pursuant to authority
vested in them by the Articles of Incorporation:
RESOLVED: That the Corporation's Articles of Incorporation be amended as set
forth below. Such Amendment creates series of Convertible Preferred Stock.
The preferences and relative rights of each series, and the qualifications,
limitations and restrictions thereof shall be as set forth below and are
hereby authorized and approved:
SECTION 1. Definitions. The following terms shall have the respective
meanings ascribed to them below.
"Board" shall mean the Board of Directors of the Corporation.
"Business Day" shall mean any day other than Saturday, Sunday or a day on
which federally-chartered banks located in New York, New York or Portland,
Oregon are permitted by law to be closed.
"Closing Date" shall mean October 15, 1997.
"Closing Price" at any date shall mean the last reported sale price of the
Common Stock on the NASDAQ Stock Market or other principal market of the
Common Stock on such date.
"Common Stock" shall mean, collectively, the Corporation's Common Stock and
any capital stock of any class of the Corporation (other than any Preferred
Stock) hereafter authorized that is not limited to a fixed amount of
percentage of par or stated value in respect of the rights of the holders
thereof to participate in dividends or in the distribution of assets upon any
liquidation, dissolution or winding up of the Corporation.
"Conversion Stock" shall mean shares of the Corporation's Common Stock
issuable upon the conversion of any shares of Preferred Stock.
"Excluded Stock" shall mean (i) shares of Common Stock issued or reserved for
issuance by the Corporation as a stock dividend payable in shares of Common
Stock, or upon any subdivision or split-up of the outstanding shares of
Common Stock, or upon conversion of shares of the Preferred Stock, (ii) up
to 3,650,000 shares of Common Stock (or Rights (as defined below)) therefor
issued to directors, officers or employees of the Corporation or its
affiliates (or in the case of options, granted at an exercise price) at less
than Fair Value under a duly-enacted stock option or compensation plan, or
(iii) any shares of Common Stock issuable upon exercise of any warrants
currently outstanding or warrants which the Corporation has committed, as of
October 15, 1997, to issue in the future.
"Fair Value" shall mean the fair market value of any securities or assets as
reasonably and in good faith determined by the Board.
"Junior Securities" shall mean any of the Corporation's equity securities
(whether or not currently authorized) that are junior in liquidation
preference to the Preferred Stock.
"Liquidation Value" of any share of Series A Preferred Stock or Series B
Preferred Stock as of any particular date shall be equal to $15.00 per share.
Liquidation Value of Series C Preferred Stock is the Series C Issuance Price.
"Market Price" of any security shall mean the average of the closing prices
of such security's sales on all securities exchanges on which such security
may at the time be listed, or, if there have been no sales on any such
exchange on any day, the average of the highest bid and lowest asked prices
on all such exchanges at the end of such day, or, if on any day such security
is not so listed, the average of the representative bid and asked prices
quoted in the NASDAQ Stock Market as of 4:00 p.m., New York time, or, if on
any day such security is not quoted in the NASDAQ Stock Market, the average
of the highest bid and lowest asked prices on such day in the domestic over-
the-counter market as reported by the National Quotation Bureau,
Incorporated, or any similar successor organization, in each such case
averaged over a period of the 10 trading days preceding the determination
date. If at any time such security is not listed on any securities exchange
or quoted in the NASDAQ Stock Market or the over-the-counter market, the
"Market Price" shall be the Fair Value thereof.
"Person" shall mean an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, an
unincorporated organization and a governmental entity or any department,
agency or political subdivision thereof.
"Preferred Stock" shall mean the Series A Preferred Stock, the Series B
Preferred Stock and the Series C Preferred Stock, or, as the context
requires, all such series of preferred stock of the Corporation.
"Preferred Issuance Price" shall mean the purchase price per share for the
Series A Preferred Stock, which is $15.00, and the purchase price per share
for the Series B Preferred Stock, which is $15.00.
"Series C Issuance Price" means the original price per share at which Series
C Preferred Stock is issued.
"Subsidiary" shall mean any Person of which the shares of outstanding capital
stock or other equity interests, as the case may be, possessing the voting
power under ordinary circumstances in electing the board of directors are, at
the time as of which any determination is being made, owned by the
Corporation either directly or indirectly through subsidiaries.
SECTION 2. Preferred Stock. (a) Series A Preferred Stock. 1,235,000 shares
of the preferred stock, without par value, of the Corporation are hereby
constituted as a series of preferred stock of the Corporation designated as
Series A Convertible Preferred Stock (the "Series A Preferred Stock"). Such
amount shall be adjusted by the Corporation in the event that any adjustments
to the Series A Preferred Stock are required as set forth herein, including
Section 7 hereof, and, in connection therewith, the Corporation shall
promptly take all necessary or appropriate actions and make all necessary or
appropriate filings in connection therewith.
(b) Series B Preferred Stock. 200,000 shares of the preferred stock, without
par value, of the Corporation are hereby constituted as a series of preferred
stock of the Corporation designated as Series B Convertible Preferred Stock
(the "Series B Preferred Stock"). Such amount shall be adjusted by the
Corporation in the event that any adjustments to the Series B Preferred Stock
are required as set forth herein, including Section 7 hereof, and, in
connection therewith, the Corporation shall promptly take all necessary or
appropriate action and make all necessary or appropriate filings in
connection therewith.
(c) Series C Preferred Stock. 200,000 shares of the preferred stock, without
par value, of the Corporation are hereby constituted as a series of preferred
stock of the Corporation designated as Series C Convertible Preferred Stock
(the "Series C Preferred Stock"). Such amount shall be adjusted by the
Corporation in the event that any adjustments to the Series C Preferred Stock
are required as set forth herein, including Section 7 hereof, and, in
connection therewith, the Corporation shall promptly take all necessary or
appropriate action and make all necessary or appropriate filings in
connection therewith.
SECTION 3. Dividends. (a) General. (1) Series A Preferred Stock. Each
outstanding share of Series A Preferred Stock shall accrue a dividend equal
to 9% per annum of the Preferred Issuance Price of Series A Preferred Stock,
compounded semi-annually beginning six months from the date of first issuance
of Series A Preferred Stock; such dividend shall be paid by issuance of
additional shares of Series A Preferred Stock, based upon a value equal to
the Preferred Issuance Price.
(2) Series B Preferred Stock. The holder of each share of Series B Preferred
Stock shall be entitled to receive, pro rata among such holders and on a pari
passu basis with the holders of the Series C Preferred Stock and the holders
of Common Stock, as if the Series B Preferred Stock had been converted into
Common Stock immediately prior to the record date in respect thereof, when
and as declared by the Board out of funds legally available for the
declaration and payment of dividends, cash dividends at the same rate and in
the same amount per share as any and all dividends declared and paid in
respect of the Common Stock. Except as set forth above, such holders shall
not be entitled to receive any dividends.
(3) Series C Preferred Stock. The holder of each share of Series C Preferred
Stock shall be entitled to receive, pro rata among such holders and on a pari
passu basis with the holders of the Series B Preferred Stock and the holders
of Common Stock, as if the Series C Preferred Stock had been converted into
Common Stock immediately prior to the record date in respect thereof, when
and as declared by the Board out of funds legally available for the
declaration and payment of dividends, cash dividends at the same rate and in
the same amount per share as any and all dividends declared and paid in
respect of the Common Stock. Except as set forth above, such holders shall
not be entitled to receive any dividends.
(b) Payment of Dividends. (1) Series A Preferred Stock. Dividends
accrued and unpaid on shares of Series A Preferred Stock as of the Mandatory
Conversion Date (as defined in Section 6(a)(1) below) shall be payable in
accordance with Section 6 below.
(2) Series B Preferred Stock. Dividends payable in respect of the Series B
Preferred Stock shall be paid as and when dividends are paid in respect of
the Common Stock.
(3) Series C Preferred Stock. Dividends payable in respect of the Series C
Preferred Stock shall be paid as and when dividends are paid in respect of
the Common Stock.
(4) Change in Dividend Rate. If the Corporation shall fail to declare or
pay a dividend on a date on which dividends are to be compounded pursuant to
Section 3(a)(1) hereof, dividends on each share of Series A Preferred Stock
shall thereupon begin to accrue at the rate of 9% of the sum of (a) the
Preferred Issuance Price and (b) accrued and unpaid dividends on such date.
If a dividend that was accrued and unpaid on a date dividends are to be
compounded is subsequently paid, the rate at which dividends accrue shall
thereupon be lowered to reflect such payment.
SECTION 4. Liquidation. Upon any liquidation, dissolution or winding up of
the Corporation, each holder of Preferred Stock shall be entitled to receive
from amounts remaining after satisfaction of creditors and holders of
securities (if any) with liquidation preferences senior to the Preferred
Stock, and pro rata based on the respective outstanding liquidation
preferences with holders of securities with a liquidation preference pari
passu to the Preferred Stock, an amount equal to the Liquidation Value, plus
accrued and unpaid dividends thereon, per share multiplied by the number of
shares of Preferred Stock, held by such holder, until paid in full, in
preference and priority to any distribution to any holder of Junior
Securities. The Corporation shall provide written notice of such
liquidation, dissolution or winding up, not less than 30 days prior to the
payment date stated therein, to each record holder of any shares of Preferred
Stock.
SECTION 5. Voting Rights. (a) No Voting. Except as provided in Section
5(b) below or as required by the Oregon Business Corporation Act, the
outstanding shares of Preferred Stock shall not be entitled to vote on any
matter as to which stockholders of the Corporation shall be entitled to vote.
(b) Special Voting Rights. The Corporation shall not, without first
obtaining the affirmative vote or written consent of a majority in interest
of the Series A Preferred Stock, voting as a class:
(1) amend or repeal any provision of, or add any provision to, the
Corporation's Articles of Incorporation or By-laws if such action would
adversely alter preferences, rights, privileges or powers of, or the
restrictions provided herein for the benefit of, the Series A Preferred
Stock;
(2) create a series of Preferred Stock with a liquidation preference senior
to the Series A Preferred Stock;
(3) effect any merger, consolidation or similar transaction; or
(4) increase or decrease the number of authorized shares of Series A
Preferred Stock, except as required by Section 2 hereof.
SECTION 6. Conversion. (a) Series A Preferred Stock. (1) Mandatory
Conversion. All holders of Series A Preferred Stock shall be required to
convert all of the outstanding shares of Series A Preferred Stock as of
the seventh anniversary of the Closing Date (the "Mandatory Conversion
Date"), in which case the aggregate Preferred Issuance Price of all
shares of the Series A Preferred Stock plus accrued and unpaid dividends
thereon held by each holder shall be converted into a number of shares
of Common Stock determined by dividing such sum by a price per share of
Common Stock (the "Fixed Conversion Floor Price") equal to 80% of the
average of the Closing Prices for the 10 trading days ending on the day
that is two business days prior to the Mandatory Conversion Date
thereof; provided, that if the average of such Closing Prices is greater
than or equal to $1.80, such conversion price shall be equal to $1.50
per share (the "Fixed Mandatory Conversion Rate").
(2) Conversion Prior to Mandatory Conversion Date. Prior to the Mandatory
Conversion Date, all holders of Series A Preferred Stock shall have the right
to convert each share of Series A Preferred Stock into ten shares of Common
Stock, without giving effect to accrued and unpaid dividends, but subject to
Section 6(e) below (the "Anti-dilution Adjustments").
(b) Series B Preferred Stock. Series B Preferred Stock is convertible in the
same manner and subject to the same terms and conditions as provided for in
Section 6(a) above with respect to the holders of Series A Preferred Stock.
(c) Series C Preferred Stock. (1) Mandatory Conversion. All holders of
Series C Preferred Stock shall be required to convert all of the outstanding
shares of Series C Preferred Stock as of the Mandatory Conversion Date, in
which case the aggregate Preferred Issuance Price of all shares of the Series
C Preferred Stock plus accrued and unpaid dividends thereon held by each
holder shall be converted into a number of shares of Common Stock determined
by dividing such sum by one-tenth of the Series C Issuance Price.
(2) Conversion Prior to Mandatory Conversion Date. Prior to the Mandatory
Conversion Date, all holders of Series C Preferred Stock shall have the right
to convert each share of Series C Preferred Stock into ten shares of Common
Stock, without giving effect to accrued and unpaid dividends, but subject to
the Anti-dilution Adjustments".
(c) Conversion Procedure. (1) Before any holder of shares of Preferred
Stock shall be entitled to convert any of such shares into shares of Common
Stock, such holder shall surrender the certificate or certificates, duly
endorsed, at the office of the Corporation or of any transfer agent for the
Preferred Stock, and shall give written notice to the Corporation at its
principal corporate office of the election to convert such shares and shall
state therein the name or names in which the certificate or certificates for
shares of Common Stock are to be issued.
(2) Each conversion of any shares of Preferred Stock shall be deemed to have
been effected on the close of business on the date on which the certificate
or certificates representing such Preferred Stock to be converted have been
surrendered at the principal corporate office of the Corporation or the
office of any transfer agent for the Preferred Stock. At such time as such
conversion has been effected, the rights of the holder of such Preferred
Stock as a holder shall cease, the Person or Persons in whose name or names
any certificate or certificates for shares of Conversion Stock are to be
issued upon such conversion shall be deemed to have become the holder or
holders of record of the shares of Conversion Stock represented thereby.
(3) As soon as possible after a conversion has been effected (but in any
event within five business days in the case of clause (6) below), the
Corporation or its transfer agent shall deliver to the converting holder:
(i) a certificate or certificates representing the number of shares of
Conversion Stock issuable by reason of such conversion in such name or names
and such denomination or denominations as the converting holder has
specified; and
(ii) payment in an amount equal to the amount payable under clause (6) below
with respect to such conversion.
(4) The issuance of certificates for shares of Conversion Stock upon
conversion of the Preferred Stock shall be made without charge to the holders
of such Preferred Stock for any cost incurred by the Corporation in
connection with such conversion and the related issuance of shares of
Conversion Stock. Upon conversion of each share of Preferred Stock, the
Corporation shall take all such actions as are necessary in order to ensure
that the Conversion Stock issuable with respect to such conversion shall be
validly issued, fully paid and nonassessable.
(5) The Corporation shall not close its books against the transfer of the
Preferred Stock or of Conversion Stock issued or issuable upon conversion of
the Preferred Stock in any manner which interferes with the timely conversion
of the Preferred Stock. The Corporation shall assist and cooperate with any
holder of the Preferred Stock or Conversion Stock required to make any
governmental filings or obtain any governmental approval prior to or in
connection with any conversion of shares hereunder (including, without
limitations, making any filings required to be made by the Corporation).
(6) If any fractional interest in a share of Conversion Stock would, except
for the provisions of this clause (6), be deliverable upon any conversion of
the Preferred Stock, the Corporation, in lieu of delivering the fractional
share therefor, shall pay an amount to the holder thereof equal to the Market
Price of such fractional interest as of the date of conversion.
(7) The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Conversion Stock, solely for the purpose of
issuance upon the conversion of the Preferred Stock, such number of shares of
Conversion Stock issuable upon the conversion of all outstanding shares of
Preferred Stock. All shares of Conversion Stock which are so issuable shall,
when issued, be duly and validly issued, fully paid and nonassessable and
free from all taxes, liens and charges. The Corporation shall take all such
actions as may be necessary to ensure that all such shares of Conversion
Stock may be so issued without violation of any applicable law or
governmental regulation or any requirements of any domestic securities
exchange or market upon which shares of Conversion Stock may be listed
(except for official notice of issuance which shall be immediately delivered
by the Corporation upon each such issuance and except for filings, notices of
applicability and permissions solely within the control of, or laws and
regulations solely applicable to, the holders of the Preferred Stock).
(e) Anti-dilution Adjustments. (1) Changes in Common Stock. In case the
Corporation shall at any time or from time to time after the date of filing
these Articles of Amendment (i) pay a dividend or make any other distribution
with respect to its Common Stock in shares of Common Stock, (ii) subdivide
its outstanding shares of Common Stock into a greater number of shares of
Common Stock, (iii) combine its outstanding shares of Common Stock or (iv)
issue any shares of its capital stock or other assets in a reclassification
or reorganization of the Common Stock (including any such reclassification in
connection with a consolidation or merger in which the Corporation is the
continuing entity), then the number and kind of shares of capital stock of
the Corporation or other assets that may be received upon the conversion of
the Preferred Stock shall be adjusted to the number of shares of Conversion
Stock and amount of any such securities, cash or other property of the
Corporation which the holders would have owned or have been entitled to
receive after the happening of any of the events described above had the
Preferred Stock been converted immediately prior to the record date (or, if
there is no record date, the effective date) for such event. An adjustment
made pursuant to this clause (1) shall become effective upon the effective
date of such payment, sub-division, combination or issuance as described
above. Any Conversion Stock or other assets to be acquired as a result of
such adjustment shall not be issued prior to the effective date of such
event. For the purposes of this clause (1), the number of shares of Common
Stock at any time outstanding shall not include shares held in the treasury
of the Corporation. Notwithstanding any other provision of this Section
6(e)(1), an action described in Section 6(e)(1)(i), (ii) or (iii) hereof
shall not affect the number of shares of Conversion Stock issued upon
mandatory conversion of the Preferred Stock except by operation of Section
6(e)(5) hereof.
(2) Issuance of Rights. In case the Corporation shall issue to all holders
of its Common Stock rights, options or warrants to subscribe for or purchase,
or other securities exchangeable for or convertible into, shares of Common
Stock that are not distributed to holders of Preferred Stock (any such
rights, options, warrants or other securities, collectively, "Rights")
(excluding rights to purchase Common Stock pursuant to a Corporation plan for
reinvestment of dividends or interest and excluding any Excluded Stock) at a
subscription offering, exercise or conversion price per share (as defined
below, the "offering price per share") which, before deduction of customary
discounts and commissions, is lower than the current Market Price per share
of Common Stock on the record date of such issuance or grant, whether or not,
in the case of Rights, such Rights are immediately exercisable or
convertible, then the number of shares of Conversion Stock issuable upon
conversion of the Preferred Stock shall be adjusted by multiplying the number
of shares of Conversion Stock issuable upon conversion of the Preferred Stock
immediately prior to any adjustment in connection with such issuance or grant
by a fraction, the denominator of which shall be the number of shares of
Common Stock outstanding (exclusive of any treasury shares) on the record
date of issuance or grant of such Rights plus the number of shares which the
aggregate offering price (as defined below) of the total number of shares of
Common Stock so offered would purchase at the current Market Price per share
of Common Stock on the record date, and the numerator of which is the number
of shares of Common Stock outstanding plus the aggregate number of shares of
Common Stock issuable upon exercise of the rights. Such adjustment shall be
made immediately after the record date for the issuance or granting of such
Rights. For purposes of this clause, the "offering price per share" of
Common Stock shall, in the case of Rights, be determined by dividing (x) the
total amount received or receivable by the Corporation in consideration of
the issuance of such Rights plus the total consideration payable to the
Corporation upon exercise thereof (the "aggregate offering price"), by (y)
the total number of shares of Common Stock covered by such Rights.
(3) Dividends and Distributions. In case the Corporation shall distribute
to all holders of Common Stock any dividend or other distribution of
evidences of its indebtedness or other assets (in each case other than cash
dividends and other than as provided in clause (1) above in which the holders
of the Preferred Stock are otherwise entitled to share, as provided herein)
or Rights, then, in each case, all holders of the Preferred Stock shall be
entitled to receive all of the same dividends, distributions or Rights, as
the case may be, as the holders of Common Stock, on an as-converted basis, as
and when distributed to the holders of Common Stock, at such time, if any,
that the holders of the Preferred Stock shall have elected to convert such
stock to Common Stock, as provided herein.
(4) Computations. For the purpose of any computation under clauses (1) and
(2) above, the current Market Price per share of Common Stock at any date
shall be as set forth in (i) the definition of Market Price for the 10
consecutive trading days commencing 20 trading days prior to the earlier to
occur of (A) the date as of which the Market Price is to be computed or (B)
the last full trading day before the commencement of "ex-dividend" trading in
the Common Stock relating to the event giving rise to the adjustment required
by clause (1) or (2) or (ii) any other arm's-length adjustment formula that
the Board may use in good faith. In the event the Common Stock is not then
publicly traded or if for any other reason the current market price per share
cannot be determined pursuant to the foregoing provisions of this clause (4)
the current market price per share shall be the Fair Value thereof.
(5) Adjustment. Whenever the number of shares of Conversion Stock issuable
upon voluntary conversion of the Series A Preferred Stock and Series B
Preferred Stock is adjusted as provided under clause (1) or (2), the Fixed
Mandatory Conversion Rate and the Fixed Conversion Floor Price shall be
adjusted by multiplying such prices immediately prior to such adjustment by a
fraction, the numerator of which shall be the number of shares of Conversion
Stock issuable upon voluntary conversion of any shares of Series A Preferred
Stock or Series B Preferred Stock immediately prior to such adjustment, and
the denominator of which shall be the number of shares of Conversion Stock
issuable upon voluntary conversion of any shares of Series A Preferred Stock
or Series C Preferred Stock immediately thereafter. Whenever the number of
shares of Conversion Stock issuable upon voluntary conversion of the Series C
Preferred Stock is adjusted as provided under clause (1) or (2), the Series C
Issuance Price shall be adjusted by multiplying such prices immediately prior
to such adjustment by a fraction, the numerator of which shall be the number
of shares of Conversion Stock issuable upon voluntary conversion of any
shares of Series C Preferred Stock immediately prior to such adjustment, and
the denominator of which shall be the number of shares of Conversion Stock
issuable upon voluntary conversion of any shares of Series C Preferred Stock
immediately thereafter.
(6) Securities. For the purpose of this Section 6, the term "shares of
Common Stock" shall mean (i) the class of stock designated as Common Stock,
without par value, of the Corporation on the date of filing this Certificate
or (ii) any other class of stock resulting from successive changes or
reclassifications of such shares consisting solely of changes in par value,
or from par value to no par value, or from no par value to par value.
(7) Re-Adjustment. If, at any time after any adjustment to the number of
Shares of Conversion Stock issuable upon conversion of the Preferred Stock
and the Conversion Price shall have been made pursuant to clause (2) of this
Section 6, any rights, options, warrants or other securities convertible into
or exchangeable for shares of Common Stock shall have expired, or any thereof
shall not have been exercised, the Conversion Price and the number of shares
of Conversion Stock issuable upon conversion of the Preferred Stock shall,
upon such expiration, be readjusted and shall thereafter be such as it would
have been had it been originally adjusted (or had the original adjustment not
been required, as the case may be) as if (A) the only shares of Common Stock
offered were the shares of Common Stock, if any, actually issued or sold upon
the exercise of such rights, options or warrants and (B) such shares of
Common Stock, if any, were issued or sold for the consideration actually
received by the Corporation for the issuance, sale or grant of all such
rights, options or warrants whether or not exercised; provided, further that
no such readjustment shall have the effect of increasing the Conversion Price
or decreasing the number of shares of Conversion Stock issuable upon
conversion of the Preferred Stock by an amount (calculated by adjusting such
increase or decrease as appropriate to account for all other adjustments
pursuant to this Section 6 following the date of the original adjustment
referred to above) in excess of the amount of the adjustment initially made
in respect of the issuance, sale or grant of such rights, options or
warrants.
(e) Reorganization, Reclassification Consolidation, Merger or Sale. Any
recapitalization, reorganization, reclassification, consolidation, merger,
sale of all or substantially all of the Corporation's assets to another
Person or other transaction which is effected in such a manner that holders
of Common Stock are entitled to receive (either directly or upon subsequent
liquidation) stock, securities or assets with respect to or in exchange for
Common Stock is referred to herein as an "Organic Change". Prior to the
consummation of any Organic Change, the Corporation shall make appropriate
provisions to ensure that each of the holders of each share of the Preferred
Stock shall thereafter have the right to acquire and receive, in lieu of or
in addition to (as the case may be) the shares of Conversion Stock
immediately theretofore acquirable and receivable upon the conversion of such
holder's Preferred Stock, such shares of stock, securities or assets as such
holder would have received in connection with such Organic Change if such
holder had converted its Preferred Stock immediately prior to such Organic
Change. In each such case, the Corporation shall also make appropriate
provisions to ensure that the provisions of this Section 6 hereof shall
thereafter be applicable to the Preferred Stock. The Corporation shall not
effect any such consolidation, merger or sale, unless prior to the
consummation thereof, the successor corporation (if other than the
Corporation) resulting from consolidation or merger or the corporation
purchasing such assets assumes by written instrument the obligation to
deliver to each such holder such shares of stock, securities or assets as, in
accordance with the foregoing provisions, such holder may be entitled to
acquire.
(f) Notices. (1) Immediately upon any adjustment of the number of shares
issuable upon conversion of the Preferred Stock, the Corporation shall give
written notice thereof to all holders of the Preferred Stock, setting forth
in reasonable detail and certifying the calculation of such adjustment.
(2) The Corporation shall give written notice to all holders of the
Preferred Stock at least 10 days prior to the date on which the Corporation
closes its books or takes a record of determining rights to receive any
dividends or distributions. The Corporation shall also give written notice
to the holders of the Preferred Stock at least 30 days prior to the date on
which Organic Change shall occur.
SECTION 7. Redemption. (a) Series A Preferred Stock. (i) General. Subject
to the provisions of Section 6 above, shares of Series A Preferred Stock may
be redeemed by the Corporation, as follows, upon at least 45 days' and no
more than 90 days' prior written notice, at a price equal to the sum of the
aggregate Preferred Issuance Price of the Series A Preferred Stock plus
accrued and unpaid dividends. From and after the third anniversary of the
Closing Date, if the Closing Price shall be equal to or greater than $2.25
(subject to the anti-dilution adjustments described in Section 6(e)(1) above)
for 20 out of any 30 consecutive trading days on or prior to any such
applicable date (or, if thereafter, prior to any date for such a redemption
if not effected prior thereto) (the "Redemption Price Condition"), the
Corporation shall have the right to redeem one-third of the Series A
Preferred Stock (as to the Preferred Issuance Price thereof), together with
one-third of the then-accrued and unpaid dividends through such date. From
and after the fourth anniversary of the Closing Date, if the Redemption Price
Condition is met, the Corporation shall have the right to redeem an
additional one-third of the Series A Preferred Stock (as to the Preferred
Issuance Price thereof), together with one-half of the then-accrued and
unpaid dividends at such date (or two-thirds of then-accrued and unpaid
dividend at the second date if no Series A Preferred Stock was previously
redeemed at or after the first such date). From and after the fifth
anniversary of the Closing Date, if the Redemption Price Condition is met,
the Corporation shall have the right to redeem the balance of the Series A
Preferred Stock, together with the remaining accrued and unpaid dividends at
such date. Prior to redemption, the Corporation must provide the applicable
redemption notice within 60 days of the achievement of the Redemption Price
Condition.
(ii) Early Redemption. The Series A Preferred Stock (or any portion thereof)
may be redeemed by the Corporation prior to such three, four or five-year
period, as applicable, only in the event the Corporation shall have
reasonably determined, in good faith, after consultation with the original
holder of shares of Series A Preferred Stock to abandon the development of
the Technology (as defined in the Securities Purchase Agreement dated as of
the Closing Date among the Corporation and Elan International Services, Ltd.,
a Bermuda corporation) or products based on the Technology.
(iii) Notice of Redemption. Not less than 45 days but not more than 90 days
prior to the date of any redemption (each, a "Redemption Date"), as permitted
by this Section 7(a), the Corporation shall send a written notice of
redemption (the "Notice") to each holder of Series A Preferred Stock to be
redeemed in the manner provided herein. The notice shall identify:
(1) the Redemption Date;
(2) the redemption price to be paid to such holder, as provided above (the
"Redemption Price"), and applicable to such Series A Preferred Stock;
(3) the number of shares of Common Stock into which a share of Series A
Preferred Stock, Series C Preferred Stock or Series C Preferred Stock, as the
case may be, is convertible;
(4) the name and address of the transfer agent, if any, in respect of the
Series A Preferred Stock;
(5) that Series A Preferred Stock called for redemption may be converted by
the holder, as otherwise provided herein, at any time before the close of
business on the Redemption Date; and
(6) that Series A Preferred Stock called for redemption must be surrendered
to the transfer agent at the office of the Corporation or its transfer agent
to collect the Redemption Price.
(iv) Effect of Notice of Redemption. Upon the Notice, Series A Preferred
Stock called for redemption shall become due and payable on the Redemption
Date, unless converted prior to such date, and at the Redemption Price stated
in the Notice. Upon surrender to the Corporation or transfer agent shares
shall be redeemed and the Redemption Price stated in the Notice shall be paid
in cash in full.
(b) Series B Preferred Stock. Shares of Series B Preferred Stock shall be
redeemable by the Corporation in the same manner and subject to the same
terms and conditions as set forth for redemption of shares of Series A
Preferred Stock in Section 7(a) above.
(c) Series C Preferred Stock. Shares of Series C Preferred Stock shall be
redeemable by the Corporation in the same manner and subject to the same
terms and conditions as set forth for redemption of shares of Series A
Preferred Stock in Section 7(a) above, except that shares of Series C
Preferred Stock shall be redeemed at a price equal to the sum of the
aggregate Series C Issuance Price plus accrued and unpaid dividends.
SECTION 8. Registration of Transfer. The Corporation shall keep a register
for the registration of the record holders of the Preferred Stock. Upon the
surrender of any certificate representing any shares of Preferred Stock, the
Corporation shall, at the request of the record holder of such certificate,
execute and deliver (at the Corporation's expense, provided that the holder
will be responsible for any transfer taxes if the certificate is register in
a new name) a new certificate or certificates in exchange therefore
representing in the aggregate the number of shares of the Preferred Stock, as
applicable, represented by the surrendered certificate. Each such new
certificate shall be registered in such name and shall represent such number
of shares of the Preferred Stock, as applicable, as is requested by the
holder of the surrendered certificate and shall be substantially identical in
form to the surrendered certificate, and dividends shall accrue on the
Preferred Stock represented by such new certificate from the date to which
dividends have been fully paid on such Preferred Stock represented by the
surrendered certificate.
SECTION 9. Replacement. Upon receipt of evidence reasonably satisfactory to
the Corporation (an affidavit of the registered holder and an undertaking of
indemnity from a creditworthy indemnitor shall be satisfactory) of the
ownership and the loss, theft, destruction or mutilation of any certificate
evidencing shares of the Preferred Stock, and in the case of any such loss,
theft or destruction, upon receipt of indemnity reasonably satisfactory to
the Corporation, or, in the case of any such mutilation upon surrender of
such certificate, the Corporation shall (at its expense) execute and deliver
in lieu of such certificate a new certificate of like kind representing the
number of shares of such series represented by such lost, stolen, destroyed
or mutilated certificate and dated the date of such lost, stolen, destroyed
or mutilated certificate, and dividends shall accrue on the Preferred Stock
represented by such new certificate from the date to which dividends have
been fully paid on such lost, stolen, destroyed or mutilated certificate.
SECTION 10. Amendment and Waiver. No amendment, modification or waiver
shall be binding or effective with respect to any provision of these Articles
of Amendment without the prior written consent of a Majority in Interest of
each of the Series A Preferred Stock, Series B Preferred Stock or Series C
Preferred Stock outstanding at the time such action is taken.
SECTION 11. Notices. Except as otherwise expressly provided hereunder, all
notices referred to herein shall be in writing and shall be delivered by
registered or certified mail, return receipt requested and postage prepaid,
or by reputable overnight courier or telecopy service, charges prepaid, and
shall be deemed to have been given when so mailed or sent (a) to the
Corporation, at its principal executive offices and (b) to any stockholder,
at such holder's address as it appears in the stock records of the
Corporation (unless otherwise indicated by any such holder).
THIRD: The foregoing resolution was adopted by the Board of Directors
of the Corporation on December 4, 1997 in accordance with the provisions of
Section 60.434 of the Oregon Business Corporation Act, shareholder action not
being required.
IN WITNESS WHEREOF, Bioject Medical Technologies Inc. has caused these
Articles of Amendment to be executed this 20th day of February, 1998.
BIOJECT MEDICAL TECHNOLOGIES INC.
By: /s/Peggy J. Miller
--------------------------
Name: Peggy J. Miller
Title: Vice President,
Chief Financial Officer
and Secretary
