<PAGE> 1
As filed with the Securities and Exchange Commission on February 12, 1996.
Registration No. 33-___
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CRITICARE SYSTEMS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 3693
(State or Other (Primary Standard 39-150563
Jurisdiction of Industrial (I.R.S. Employer
Incorporation or Classification Identification No.)
Organization) Code Number)
20925 Crossroads Circle
Waukesha, Wisconsin 53186
(414) 798-8282
(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant's Principal Executive Offices)
Gerhard J. Von der Ruhr, Chairman of the Board,
President and Treasurer
20925 Crossroads Circle
Waukesha, Wisconsin 53186
(414) 798-8282
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
Copies to:
Reinhart, Boerner, Van Deuren,
Norris & Rieselbach, s.c.
1000 North Water Street, Suite 2100
Milwaukee, WI 53202
Attn: Robert E. Bellin, Esq.
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. / /
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
<PAGE> 2
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
________________________________________________________________________________
Proposed Proposed
Maximum Maximum
Title of Shares Amount Aggregate Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share(1) Price(1) Fee
________________________________________________________________________________
<S> <C> <C> <C> <C>
Common Stock,
$.04 Par Value 333,154 $3.6875 $1,228,506 $424
________________________________________________________________________________
</TABLE>
(1) Calculated in accordance with Rule 457(c) based on the average of the high
and low sales prices of the Common Stock as reported on the Nasdaq National
Market on February 6, 1996 solely for the purpose of calculating the amount of
the registration fee.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE> 3
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED FEBRUARY 12, 1996
333,154 Shares
CRITICARE SYSTEMS, INC.
COMMON STOCK
The shares offered hereby (the "Shares") consist of 333,154 shares of
common stock, $.04 par value per share (the "Common Stock") of Criticare
Systems, Inc., a Wisconsin corporation ("Criticare Systems" or the "Company")
which are owned by the selling shareholders listed herein under "Selling
Shareholders" (individually, a "Selling Shareholder" and collectively, the
"Selling Shareholders"). The Shares may be offered from time to time by the
Selling Shareholders. All expenses of the registration incurred in connection
herewith are being borne by the Company, but any brokers' or underwriters' fees
or commissions will be borne by the Selling Shareholder. The Company will not
receive any proceeds from the sale of the Shares by the Selling Shareholders.
The Selling Shareholders have not advised the Company of any specific
plans for the distribution of the Shares covered by this Prospectus, but it is
anticipated that the Shares will be sold from time to time primarily in
transactions (which may include block transactions) on the Nasdaq National
Market at the market price then prevailing, although sales may also be made in
negotiated transactions or otherwise. The Selling Shareholders and the brokers
and dealers through whom sale of the Shares may be made may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended
(the "Securities Act"), and their commissions or discounts and other
compensation may be regarded as underwriters' compensation. See "Plan of
Distribution."
The Common Stock is currently listed on the Nasdaq National Market under
the symbol "CXIM." On February 8, 1996, the last reported sale price of the
Common Stock on the Nasdaq National Market was $3-13/16 per share.
THERE ARE CERTAIN RISK FACTORS WHICH SHOULD BE CONSIDERED BEFORE
PURCHASING SHARES IN THIS OFFERING. SEE "RISK FACTORS."
______________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is February __, 1996.
<PAGE> 4
AVAILABLE INFORMATION
This Prospectus, which constitutes a part of a Registration Statement on
Form S-3 (the "Registration Statement") filed by the Company with the
Securities and Exchange Commission (the "Commission") under the Securities Act,
omits certain of the information set forth in the Registration Statement.
Reference is hereby made to the Registration Statement and to the exhibits
thereto for further information with respect to the Company and the securities
offered hereby. Copies of the Registration Statement and the exhibits thereto
are on file at the offices of the Commission and may be obtained upon payment
of the prescribed fee or may be examined without charge at the public reference
facilities of the Commission described below.
Statements contained herein and concerning the provisions of documents are
necessarily summaries of such documents, and each statement is qualified in its
entirety by reference to the copy of the applicable document filed with the
Commission.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and in accordance
therewith files reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information can be
inspected and copied at the Public Reference Section of the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the following
regional offices of the Commission: Midwest Regional Office, Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, IL 60661, and Northeast Regional
Office, 7 World Trade Center, Suite 1300, New York, NY 10048. Copies of such
material can also be obtained at prescribed rates by writing to the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents or portion of a document filed by the Company with
the Commission (File No. 0-16061) are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
June 30, 1995.
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1995.
(c) The description of the Company's Common Stock which is contained in
the Company's Registration Statement on Form 8-A filed on July 23, 1987 under
the Exchange Act, including all amendments and reports filed for the purpose of
updating such description.
All reports and other documents filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent
to the date of this Prospectus and prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part hereof from the date of the
filing of such reports and documents. Any statement contained in a document,
all or a portion of which is incorporated by reference herein, shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained or incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered a copy of any or all of such documents which are
incorporated herein by reference (other than exhibits to such documents unless
such exhibits are specifically incorporated by reference into the documents
that this Prospectus incorporates). Written or oral request for copies should
be directed to Richard J. Osowski, Senior Vice President Finance and Assistant
Secretary, Criticare Systems, Inc., 20925 Crossroads Circle, Waukesha,
Wisconsin 53186, (414) 798-8282.
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<PAGE> 5
THE COMPANY
Criticare designs, manufactures and markets vital signs and gas monitoring
instruments and related noninvasive sensors used to monitor patients in many
healthcare settings. Since a patient's oxygen, anesthetic gas and carbon
dioxide levels can change dramatically within minutes, causing severe side
effects or death, continuous monitoring of these parameters is increasing. The
Company's monitoring equipment improves patient safety by delivering accurate,
comprehensive and instantaneous patient information to the clinician. The
Company's products also allow hospitals to contain costs primarily by
substituting cost-effective reusable pulse oximetry sensors for disposable
sensors, controlling the use of costly anesthetics and increasing personnel
productivity.
To meet the needs of end-users in a wide variety of patient settings, the
Company has developed a broad line of patient monitors which combine one or
more of its patented or other proprietary technologies, for monitoring oxygen
saturation, carbon dioxide and anesthetic agents, with standard monitoring
technologies that provide electrocardiogram ("ECG"), invasive and noninvasive
blood pressures, temperature, heart rate and respiration rate. In addition,
the Company's VitalView telemetry system allows one nurse to monitor up to
eight patients simultaneously from a convenient central location. This allows
hospitals to move out of the intensive care unit ("ICU") those patients that
require continuous monitoring, but do not need all of an ICU's extensive and
costly personnel and equipment resources.
The Company was incorporated under the laws of the State of Delaware in
October 1984.
The Company's principal executive offices are located at 20925 Crossroads
Circle, Waukesha, Wisconsin 53186, and its telephone number is (414) 798-8282.
3
<PAGE> 6
RISK FACTORS
Prospective investors should carefully consider the risk factors set forth
below as well as the other information contained in this Prospectus.
COMPETITION
The markets for the Company's products are highly competitive. Many of
the Company's competitors have greater engineering, research and development,
manufacturing, financial and marketing resources, as well as a more established
market presence and reputation. The Company has historically experienced
substantial price competition for its products and such price competition is
likely to continue.
DEVELOPMENT OF DIRECT SALES FORCE
In fiscal 1989, the Company began the transition from relying on third
party distributors in the domestic hospital market to developing its own direct
sales force. The Company experienced reduced net sales and a net loss in
fiscal 1989 as relationships with distributors were terminated and direct sales
efforts were initiated. Although net sales and net income have increased since
fiscal 1989, the Company has experienced significant sales force turnover which
has adversely affected domestic hospital sales. While the Company believes
that recent personnel changes have improved the quality of its direct sales
force, additional turnover would have an adverse impact on the Company's
domestic hospital sales.
DEPENDENCE ON PATENTS AND PROPRIETARY TECHNOLOGY
The Company believes one of its principal competitive advantages is
provided by its patented and other proprietary technology including its sensor
technology, infrared specific anesthetic gas monitoring technology, UltraSync
signal processing software and disposable respiratory secretion filter system.
Although none of the Company's United States patents expire before 2004, to the
extent competitors develop equivalent or superior non-infringing technology in
these areas, or to the extent that the Company is unable to enforce its
patents, the Company's ability to market and sell its products could be
materially adversely affected.
DEPENDENCE ON KEY PERSONNEL
The Company relies to a substantial degree on its founder and principal
executive officer, Gerhard J. Von der Ruhr, as well as key divisional sales
officers and technical managers. The loss of any of these individuals could
materially adversely affect the Company.
INTERNATIONAL SALES
Since fiscal 1990, the Company's international sales have grown faster
than its sales to any other market, and accounted for 49.1% of the Company's
total net sales for the 1995 fiscal year. The Company expects that
international sales will continue to constitute a significant portion of its
business. Although the Company sells its products in United States dollars and
is not subject to significant currency risks, an increase in the value of the
United States dollar relative to foreign currencies in the Company's
international markets could make the Company's products less price competitive
in such markets.
GOVERNMENT REGULATION
The Company's products are subject to regulation by the United States Food
and Drug Administration (the "FDA") and comparable foreign governmental
authorities. These regulations can be burdensome and may substantially delay
or prevent the introduction of new products, materially increase the costs of
any such product introductions, interfere with or require cessation of product
manufacturing and marketing or result in product recalls. Additionally,
adoption of new regulations or modifications to applicable regulations could
adversely affect the Company.
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<PAGE> 7
COST CONTAINMENT PROGRAMS
The cost of a significant portion of medical care in the United States is
funded by government or other insurance programs. Additional limits imposed by
such programs on health care cost reimbursements may further impair the ability
of hospitals and other health care providers to purchase equipment such as the
Company's products and could adversely affect the Company's domestic sales.
PRODUCT LIABILITY EXPOSURE
As a manufacturer of medical diagnostic equipment, the Company could face
product liability claims. Criticare has had no product liability claims to
date and maintains product liability insurance in an aggregate amount of $5
million. There can be no assurance that such coverage will be adequate to
cover any product liability claims which arise in the future or that it will
continue to be available at reasonable prices.
SINGLE SOURCES OF SUPPLY
Certain of Criticare's products incorporate components currently purchased
from single sources. While the Company believes these components are available
from alternate sources on reasonable terms, an interruption in the delivery of
these components could have an adverse effect on the Company.
POSSIBLE VOLATILITY OF STOCK PRICE; FLUCTUATIONS IN QUARTERLY RESULTS
Market prices of securities of medical technology companies, including the
Company's Common Stock, have experienced significant volatility from time to
time. There may be volatility in the market price of the Common Stock due to
factors that may or may not relate to the Company's performance. Various
factors and events, such as announcements by the Company or its competitors
concerning new product developments, governmental approvals, regulations or
actions, developments or disputes relating to patent or proprietary rights and
public concern over product liability may have a significant impact on the
market price of the Common Stock. In addition, Criticare's quarterly results
have historically fluctuated.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares by
the Selling Shareholders.
SELLING SHAREHOLDERS
The 333,154 shares of the Company's Common Stock described in this
Prospectus are owned by the shareholders listed below. Except for the
ownership of the Shares, neither Selling Shareholder has had any material
relationship within the past three years with the Company. From December 18,
1992 until December 21, 1995, the Selling Shareholders were shareholders in,
and had a representative on the Board of Directors of, Immtech International,
Inc. ("Immtech"). The Company has been a shareholder of Immtech since December
19, 1988 and currently owns approximately 35.4% of Immtech's outstanding stock
on a fully diluted basis. In addition, certain officers and directors of the
Company, including Gerhard J. Von der Ruhr, a director of the Company and the
Company's Chairman of the Board, President and Treasurer, and N.C. Joseph Lai,
a director of the Company and the Company's Vice Chairman of the Board, Senior
Vice President and Secretary are shareholders and directors of Immtech. The
Shares are being registered to permit public secondary trading of the Shares,
and the Selling Shareholders may offer the Shares for resale from time to time.
See "Plan of Distribution."
The Shares being offered by the Selling Shareholders hereby were issued
by the Company to the Selling Shareholders pursuant to a certain Stock Purchase
and Sale Agreement by and among the Company, through its wholly owned
subsidiary Criticare Biomedical, Inc., and the Selling Shareholders, dated as
of August 1, 1995, as amended (the "Purchase Agreement"). Pursuant to the
Purchase Agreement, the Company, through Criticare Biomedical, purchased from
the Selling Shareholders 1,000,000 shares of Immtech's Series A Preferred Stock
and 1,200,000 shares of Immtech's Series B Preferred Stock and a promissory
note in the amount of $50,000 payable by Immtech to the Selling Shareholders
(collectively, the "Immtech Securities"). In consideration of the Immtech
Securities, the Company issued the Shares to the Selling Shareholders and
Criticare Biomedical issued promissory notes aggregating $1,240,000 to the
Selling Shareholders.
5
<PAGE> 8
In recognition of the fact that the Selling Shareholders may wish to be
legally permitted to sell the Shares when they deem appropriate, as required by
the Purchase Agreement and a Registration Rights Agreement executed in
connection therewith, the Company has filed with the Commission under the Act,
a Registration Statement on Form S-3, of which this Prospectus forms a part,
with respect to the resale of the Shares from time to time on the Nasdaq
National Market or in privately-negotiated transactions.
<TABLE>
<CAPTION>
Number of Shares Number of Shares
Name of Beneficially Owned Number of Shares Beneficially Owned
Selling Shareholder Prior to Offering Being Offered Hereby After Offering
- -------------------- ------------------ -------------------- ------------------
<S> <C> <C> <C>
Marquette Venture 323,900 323,900 0
Partners II, L.P.
MVP II Affiliates 9,254 9,254 0
Fund, L.P.
</TABLE>
PLAN OF DISTRIBUTION
The Shares being offered by the Selling Shareholders will be sold in one
or more transactions (which may involve block transactions) on the Nasdaq
National Market or in privately-negotiated transactions. The sale price to the
public may be the market price prevailing at the time of sale, a price related
to such prevailing market price or such other price as the Selling Shareholder
determines from time to time. Each Selling Shareholder shall have the sole and
absolute discretion not to accept any purchase offer or make any sale of Shares
owned by it if it deems the purchase price to be unsatisfactory at any
particular time.
The Selling Shareholders may also sell the Shares of Common Stock directly
to market makers acting as principals and/or to broker-dealers acting as agents
for themselves or their customers. Brokers acting as agents for the Selling
Shareholders will receive usual and customary commissions for brokerage
transactions, and market makers and block purchasers purchasing the Shares will
do so for their own account and at their own risk. It is possible that a
Selling Shareholder will attempt to sell Shares of Common Stock in block
transactions to market makers or other purchasers at a price per share which
may be below the then market price. There can be no assurance that all or any
of the Shares offered hereby will be sold. The Selling Shareholders and any
brokers, dealers or agents, upon effecting the sale of any of the Shares
offered hereby, may be deemed "underwriters" as that term is defined in the
Securities Act.
The Selling Shareholders have agreed that they will not pay more than the
normal brokerage compensation and that they will not enter into arrangements
for special selling efforts without first advising the Company and cooperating
in the disclosure of the same in a revised or supplemental prospectus.
The Selling Shareholders, alternatively, may sell all or any part of the
Shares offered hereby through an underwriter. Neither Selling Shareholder has
entered into any agreement with a prospective underwriter and there is no
assurance that any such agreement will be entered into. If a Selling
Shareholder enters into such an agreement or agreements, the relevant details
will be set forth in a supplement or revisions to this Prospectus.
EXPERTS
The consolidated financial statements and the related consolidated
financial statement schedule incorporated in this prospectus by reference from
the Company's Annual Report on Form 10-K for the year ended June 30, 1995 have
been audited by Deloitte & Touche LLP, independent auditors, as set forth in
their reports, which are incorporated herein by reference, and have been so
incorporated in reliance upon such reports of such firm given upon their
authority as experts in accounting and auditing.
6
<PAGE> 9
LEGAL MATTERS
The legality of the Shares of Common Stock offered hereby will be passed
upon for the Company by Reinhart, Boerner, Van Deuren, Norris & Rieselbach,
s.c., 1000 North Water Street, Suite 2100, Milwaukee, Wisconsin 53202.
7
<PAGE> 10
No person is authorized to give any information or to make any
representations not contained in this Prospectus in connection with the offer
contained herein, and, if given or made, such information or representation
must not be relied upon as having been authorized by the Company. This
Prospectus does not constitute an offer to sell or the solicitation of an offer
to buy any security other than the shares of Common Stock offered by this
Prospectus, nor does it constitute an offer to sell or a solicitation of an
offer to buy shares of Common Stock in any jurisdiction where such offer or
solicitation would be unlawful. Neither the delivery of this Prospectus nor
any sales made hereunder shall, under any circumstances, create any implication
that there has been no change in the affairs of the Company since the date
hereof.
<TABLE>
<CAPTION>
TABLE OF CONTENTS Page
----
<S> <C>
Available Information .... 2
Incorporation of Certain
Documents by Reference .. 2
The Company .............. 3
Risk Factors. ............ 4
Use of Proceeds .......... 5
Selling Shareholders ..... 5
Plan of Distribution ..... 6
Experts .................. 6
Legal Matters ............ 7
</TABLE>
333,154 Shares
CRITICARE SYSTEMS, INC.
COMMON STOCK
PROSPECTUS
February __, 1996
8
<PAGE> 11
II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The expenses relating to the registration of the Shares of Common Stock
being offered hereby, other than underwriting discounts and commissions, will
be borne by the Company. Such expenses are estimated to be as follows:
<TABLE>
<CAPTION>
Item Amount
---- --------
<S> <C>
Securities and Exchange
Commission Registration Fee $ 424
Legal Fees and Expenses 2,500
Accounting Fees and Expenses 500
Miscellaneous Expenses 500
--------
Total $3,924
========
</TABLE>
Item 15. Indemnification of Directors and Officers
The Company's By-Laws provide that the Company shall, to the fullest
extent permitted by the Delaware Corporation Law and other applicable laws, as
in effect from time to time, indemnify any person who was or is a party or is
threatened to be made a party to any formal or informal threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, including, without limitation, any action brought under
federal or state securities laws, rules or regulations (collectively,
"Actions"), other than in certain limited circumstances, because he is or was a
director or officer of the Company, or because he is or was a director or
officer of the Company and is or was serving at the request of the Company as a
director, officer, employee, consultant or agent of another corporation or
other enterprise or is or was serving at the request of the Company as a
fiduciary of an employee benefit plan or as an employee or agent of the
Company; provided, however, that no director or officer shall be entitled to
indemnification unless, with respect to the conduct that is the subject of the
Action, he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interest of the Company and, with respect to any
criminal action or proceeding, he had no reasonable cause to believe his
conduct was unlawful. This indemnification obligation mirrors the permissive
indemnification provided under section 145 of the Delaware Corporation Law.
The determination of whether indemnification is proper under the circumstances,
unless made by a court, shall be made (a) by arbitration; (b) by the Board of
Directors by a majority vote of a quorum consisting of directors who are not
parties to the subject Action; (c) if such quorum is not obtainable or, even if
obtainable, a quorum of disinterested directors so directs, by independent
legal counsel in a written opinion; or (d) by the affirmative vote of a
majority of the shares entitled to vote thereon.
Article VI, section 6.01 of the Company's Restated By-Laws provides that a
director or officer is not liable to the Company for damages arising out of any
action taken or omitted to be taken by such person if he exercised and used the
same degree of care and skill as a prudent man would have exercised or used
under the circumstances in the conduct of his own affairs or took or omitted to
take such action in reliance on the advice of the Company's counsel or
statements made or information furnished by officers or employees of the
Company which he had reasonable grounds to believe were true.
In April 1987, the Company entered into indemnity agreements with Messrs.
Von der Ruhr, Lai, Osowski, Houm and Datsopoulos. These agreements provide
that the Company will indemnify those persons, to the extent permitted under
Delaware law, against certain liabilities and expenses, including liabilities
and expenses arising under the Securities Act, to which they may become subject
as a result of serving as officers and/or directors of the Company. The
agreements also provide for the advancement of litigation expenses by the
9
<PAGE> 12
Company to these Individuals. The Company is not required to provide
indemnification (and shall be reimbursed for any advances) in the event the
claim arose out of the individual's misconduct, as defined under the
agreements. The agreements also contain a provision which requires that no
stockholder derivative action may be brought against any of these individuals
after the expiration of two years after his termination as an officer or
director.
The indemnification provided as set forth above is not exclusive of any
other rights to which a director or an officer of the Company may be entitled.
The general effect of the foregoing provisions is to reduce the
circumstances in which an officer or director may be required to bear the
economic burdens of the foregoing liabilities and expenses.
Item 16. Exhibits
Exhibit
Number Description
------- -----------
2 Stock Purchase and Sale Agreement dated as of August 1, 1995
by and among Criticare Systems, Inc., through its wholly-owned
subsidiary, Criticare Biomedical, Inc., and Marquette Venture
Partners II, L.P. and MVP Affiliates Fund, L.P., as amended by the
Amendment to Stock Purchase Agreement between such parties dated as
of October 16, 1995.
5 Opinion of Counsel.
23.1 Consent of Deloitte & Touche LLP, Independent Auditors.
23.2 Consent of Reinhart, Boerner, Van Deuren, Norris &
Rieselbach, s.c. (included in Exhibit 5).
24 Power of Attorney (incorporated by reference to the signature
page of this Registration Statement).
Item 17. Undertakings
The undersigned Registrant undertakes as follows:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(b) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement;
and
(c) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement; provided,
however, that paragraphs 1(a) and (b) will not apply if the information required
to be included in a post effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to section 13 or 15(d) of the
Exchange Act and which are incorporated by reference in this Registration
Statement.
2. That, for the purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
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<PAGE> 13
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
4. That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to section
13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan annual report pursuant to section 15(d)
of the Securities Exchange Act of 1934) that is incorporated by reference in
the Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
5. Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act, and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
11
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Milwaukee, State of Wisconsin, on the 1st day of
February, 1996.
CRITICARE SYSTEMS, INC.
BY /s/ Gerhard J Von der Ruhr
-----------------------------------
Gerhard J. Von der Ruhr, Chairman
of the Board and Chief Executive Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons on behalf
of the Registrant, in the capacities indicated below. Each person whose
signature appears below hereby appoints Gerhard J. Von der Ruhr and Richard J.
Osowski and each of them individually, his true and lawful attorney-in-fact,
with power to act with or without the other and with full power of substitution
and resubstitution, in any and all capacities, to sign any or all amendments
(including post-effective amendments) to the Registration Statement and file
the same with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or their substitutes, may lawfully cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Gerhard J. Von der Ruhr Chairman of the February 1, 1996
- ----------------------------- Board, Chief
Gerhard J. Von der Ruhr Executive Officer,
Treasurer and
Director
/s/ N.C. Joseph Lai Vice Chairman of February 1, 1996
- ----------------------------- the Board, Senior
N.C. Joseph Lai Vice President,
Secretary and
Director
/s/ Richard J. Osowski Senior Vice February 1, 1996
- ----------------------------- President-Finance
Richard J. Osowski and Assistant
Secretary
(Principal
Accounting Officer
and Principal
Financial Officer)
/s/ Karsten Houm Director February 1, 1996
- -----------------------------
Karsten Houm
/s/ Milton Datsopoulos Director February 1, 1996
- -----------------------------
Milton Datsopoulos
12
<PAGE> 15
EXHIBIT INDEX
Exhibit Page
Number Description Number
- ------- ----------- ------
2 Stock Purchase and Sale Agreement dated
as of August 1, 1995 by and among
Criticare Systems, Inc., through its wholly-
owned subsidiary, Criticare Biomedical, Inc.,
and Marquette Venture Partners II, L.P.
and MVP Affiliates Fund, L.P., as amended
by the Amendment to Stock Purchase
Agreement between such parties dated
as of October 16, 1995.
5 Opinion of Counsel
23.1 Consent of Deloitte & Touche LLP,
Independent Auditors
23.2 Consent of Reinhart, Boerner,
Van Deuren, Norris & Rieselbach, s.c.
(included in Exhibit 5)
24 Power of Attorney
(included on the signature page hereto)
13
<PAGE> 1
EXHIBIT 2
<PAGE> 2
STOCK PURCHASE AND SALE AGREEMENT
By this Stock Purchase and Sale Agreement ("Agreement"), CRITICARE
SYSTEMS, INC., a Delaware corporation ("CSI"), through its wholly-owned
subsidiary CRITICARE BIOMEDICAL, INC., a Wisconsin corporation ("Buyer"), and
MARQUETTE VENTURE PARTNERS II, L.P. and MVP II AFFILIATES FUND, L.P.
("Stockholders") hereby represent, warrant, covenant and agree as follows
RECITALS
A. Present Structure. Each Stockholder owns the number of shares of
issued and outstanding Class A and Class B Preferred Stock set forth on
Schedule A (collectively the "Stock") of Immtech International, Inc., a
Delaware corporation ("Immtech"), and promissory notes payable by Immtech in
the principal amounts set forth on Schedule A (the "Notes"). The Stock
constitutes approximately 34% of the issued and outstanding stock of Immtech
on a fully diluted basis as of the date of this Agreement.
B. Sale of Stock. Stockholders desire to sell the Stock and the Notes and
Buyer desires to purchase the Stock and the Notes, all on the terms and
conditions set forth herein.
ARTICLE 1
PURCHASE TERMS
1.1 Conveyance of Stock and Notes. At the Closing (as defined in Article
4, section 4.1), Stockholders shall sell, transfer, assign and deliver the
Stock and the Notes to Buyer, free and clear of any liens, security interests
or other encumbrances and in connection therewith shall assign to Buyer all of
their rights under the Ancillary Agreements (defined in Article 2, section 2.10
below).
1.2 Purchase Price: Payment. The total purchase price for the Stock and
the Notes shall initially be 950,000 shares of the $0.04 par value Common Stock
of CSI (the "Base Shares"). The number of Base Shares assumes a valuation of
$2.00 per share or a net purchase price of $1,900,000, however, the actual
number of shares issuable at Closing (the "Closing Shares") shall be adjusted
to reflect changes in the Market Price of the Base Shares as follows:
(a) If the Market Price is between $1.80 and $2.20, there will be no
change in the number of shares and the number of Closing Shares shall equal
950,000;
<PAGE> 3
(b) Subject to the limit contained in section 1.2(e) below, if the
Market Price is above $2.20 per share, the number of Closing Shares shall be
determined pursuant to the following formula:
.75 (950,000 x (Market Price -- $2.00))
950,000 - --------------------------------------
Market Price
For example, if the Market Price is $3.00, the number of Closing Shares would
equal 712,500.
(c) Subject to the limit contained in section 1.2(e) below, if the
Market Price is less than $1.80 per share, the number of Closing Shares shall be
determined pursuant to the following formula:
.75 (950,000 x ($2.00 -- Market Price))
950,000 + --------------------------------------
Market Price
For example, if the Market Price is $1.50, the number of Closing Shares would
equal 1,187,500.
(d) The term Market Price as used herein shall be the average of the
last sale prices of CSI's Common Stock as reported on NASDAQ/NMS for the 15
business days preceding the closing date.
(e) Notwithstanding anything contained herein to the contrary,
Stockholders shall receive no fewer than 544,167 shares under section 1.2(b) and
no more than 1,266,667 shares under section 1.2(c). Such shares shall be
delivered at the Closing as provided in Article 4.
1.3 Adjustments. In the event of a reorganization, recapitalization,
change of shares, stock-split, spin-off, stock dividend, reclassification,
subdivision or consolidation of shares, or any other change in the corporate
structure of shares of Common Stock of CSI, the Closing Shares shall be
adjusted as appropriate to provide the same economic benefit to Stockholders as
initially contemplated by this Agreement.
2
<PAGE> 4
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
OF STOCKHOLDERS
Except as otherwise specifically provided in this Article 2, as of the
date of this Agreement, Stockholders, jointly and severally, represent and
warrant to Buyer as follows:
2.1 Due Authorization. Each Stockholder has full power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized and no other proceedings on the part of either Stockholder are
necessary to authorize this Agreement or to consummate the transactions so
contemplated. This Agreement has been duly and validly executed and delivered
by each Stockholder and constitutes a valid and binding agreement of each
Stockholder, enforceable against each Stockholder in accordance with its terms,
subject to the laws of general application affecting the rights and remedies of
creditors and the availability of equitable remedies.
2.2 Consents and Approvals; No Violation. There is no requirement
applicable to either Stockholder to make any filing with, or to obtain any
permit, authorization, consent or approval of, any governmental or regulatory
authority as a condition to the lawful consummation by either Stockholder of
the sale of the Stock or the Notes pursuant to this Agreement. The execution
and delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby will not, violate, conflict with or result in a default
under (including any right of termination or acceleration) any provisions
(including provisions requiring any consent or approval) of any partnership
agreement, charter, by-law, mortgage, note, indenture, lien, order, judgment,
decree, or of any material lease, agreement or instrument, to which either
Stockholder is a party or by which either Stockholder is bound, and will not
violate any other restriction of any kind or character to which either
Stockholder is subject.
2.3 Title to Stock. Each Stockholder has good and marketable title to the
Stock and the Notes, free and clear of any and all pledges, liens, security
interests, encumbrances or charges of any nature whatsoever.
2.4 Material Contracts; No Defaults. Except as set forth or reflected in
Schedule 2.4 or in Immtech's Financial Statements, neither Immtech nor
Stockholder is in material default under any agreement between them. There is
not, under any of the agreements or other obligations between Stockholder and
Immtech, any event of default or event which, with notice or lapse of time or
both, would constitute an event of default on the part of Stockholder or
Immtech, except such events of default and other events as to which requisite
waivers or consents have been obtained or which would not, in the
3
<PAGE> 5
aggregate, have a material adverse effect on Immtech taken as a whole. Copies
of all such waivers or consents are attached hereto as Schedule 2.4.
2.5 Pending Litigation; Contingencies To the knowledge of Stockholders
and except as set forth on Schedule 2.5 to this Agreement, there are no
actions, suits, proceedings or formal inquiries before any court, arbitration
board, regulatory agency or governmental body pending against Immtech which
could reasonably be expected to have a material adverse effect on its financial
condition, business, operation or assets, taken as a whole and Immtech is not
subject to any outstanding orders, writs, injunctions or decrees which in the
aggregate materially and adversely affect the financial condition, business,
operation or assets of Immtech taken as a whole.
2.6 Accredited Investor. Stockholders are "accredited investors" (as such
term is defined in Rule 501(a) promulgated under the Securities Act of 1933, as
amended (the "Securities Act") and have such knowledge and experience in
financial and business matters that Stockholders are capable of evaluating the
merits and risks of their purchase of the Closing Shares for which the Stock
and Notes are to be exchanged and able to bear the substantial economic risks
of an investment in the Closing Shares.
2.7 Independent Evaluation of CSI and Full Disclosure. In deciding
whether to acquire the Closing Shares, the Stockholders have relied upon
consultations with the Stockholders' legal, financial and tax advisers with
respect to this Agreement and the nature of their investment and have reviewed
the information set forth in (a) CSI's Annual Reports on Form 10-K for the
fiscal years ended June 30, 1994, June 30, 1993 and June 30, 1992, (b) CSI's
Quarterly Reports on Form 10-Q for the fiscal quarters ending March 31, 1995,
December 31, 1994 and September 30, 1994, (c) Proxy Statements relating to all
meetings of CSI's shareholders (whether annual or special) during the last
three fiscal years, (d) all other reports, statements and registration
statements (including current reports on Form 8-K and quarterly reports on Form
10-Q) filed by CSI under the Securities Exchange Act of 1934 with the
Securities and Exchange Commission (the "SEC") since June 30, 1994
(collectively, the "CSI SEC Reports"), all of which has been delivered to
Stockholders prior to the execution hereof, receipt of which is hereby
acknowledged (the "CSI Disclosure Package"). Stockholders confirm that CSI has
made available to the Stockholders the opportunity to ask questions of its
officers and to acquire such additional information about the business and
financial condition of CSI as the Stockholders have requested, which additional
information, if so requested, has been satisfactorily received. The
Stockholders have not relied upon any representations of CSI with respect to
their investment, except as specifically set forth in this Agreement.
2.8 Purchase for Investment Only. The Closing Shares are being acquired
by each Stockholder solely for its own account, for investment, with no present
4
<PAGE> 6
intention of making a public distribution thereof within the meaning of the
Securities Act, except as permitted under the Registration Rights Agreement (as
hereinafter defined). The Closing Shares will not be sold or transferred by
the Stockholder in violation of the Securities Act or any state or other
jurisdiction's securities laws and the financial condition of the Stockholder
is such that the investment in the Closing Shares can be made on a long-term
basis. Stockholder is aware that the Closing Shares has not been registered
under the Securities Act or any state or other jurisdiction's securities laws,
that the Closing Shares purchased hereby must be held indefinitely unless
subsequently registered or an exemption from such registration is secured and
that, other than as set forth in the Registration Rights Agreement (as
hereinafter defined) CSI is not under any obligation to register any of the
Closing Shares under the Securities Act or any state or other jurisdiction's
securities law.
2.9 Restrictions on Transfer. Each Stockholder agrees that CSI will
permit transfers of the Closing Shares by Stockholder only when the Closing
Shares has been registered under the Securities Act and any applicable state or
other jurisdiction's securities laws or when the request for transfer is
accompanied by an opinion of counsel reasonably acceptable to CSI to the effect
that the sale or proposed transfer does not require registration under the
Securities Act or any state or other jurisdiction's securities laws.
Stockholder agrees that the following legend shall be placed on the certificate
or certificates representing his or her Closing Shares and a stop transfer
order may be placed with respect thereto:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR ANY APPLICABLE STATE SECURITIES LAW AND WERE ISSUED IN A
TRANSACTION TO WHICH REGULATION D UNDER THE SECURITIES ACT APPLIES
AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS (i) A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND SUCH
APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE WITH
REGARD THERETO, (ii) MADE IN COMPLIANCE WITH ALL OF THE PROVISIONS
OF RULE 144, OR (iii) IN THE OPINION OF COUNSEL REASONABLY
ACCEPTABLE TO THE COMPANY, REGISTRATION UNDER THE SECURITIES ACT
AND SUCH APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED IN
CONNECTION WITH A PROPOSED SALE OR TRANSFER.
2.10 Ancillary Agreements. Each of the Ancillary Agreements is legally
valid and binding and in full force and effect with respect to the parties
thereto and neither Stockholders nor, to the Stockholders' knowledge, any of
the other parties to any of the Ancillary Agreements are in default thereof.
Stockholders have no notice or
5
<PAGE> 7
knowledge of any claimed breach of any of the Ancillary Agreements or of the
occurrence of any event which after the passage of time or the giving of notice
or both would constitute a default by Stockholders or any other party to any
Ancillary Agreement. None of the material rights of Stockholders under the
Ancillary Agreements will be impaired in any respect by the consummation of the
transactions contemplated by this Agreement. The Ancillary Agreements are
validly assignable and all of the rights of Stockholders thereunder will be
enforceable by Buyer after the Closing without the consent or the agreement of
any other party except for consents delivered by Stockholders at Closing. For
purposes of this Agreement, "Ancillary Agreements" means all agreements entered
into by Stockholders which give Stockholders rights as holders of securities of
Immtech, including such agreements entered into pursuant to that certain Stock
Purchase Agreement dated as of December 18, 1992 by and between Immtech and
Marquette Ventures II, L.P., including, but not limited to, the Registration
Agreement, the Executive Stock Agreement and the Stock Option Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER
As of the date of this Agreement, Buyer and CSI, jointly and severally,
represent and warrant to Stockholders as follows:
3.1 Organization. Buyer and CSI are corporations duly organized and in
good standing under the laws of their jurisdictions of incorporation and have
all requisite power and authority to own, lease and use their properties and
assets and to conduct their businesses as now being conducted.
3.2 Due Authorization. Buyer and CSI have full power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by the Boards of Directors of Buyer and CSI, respectively, and,
except as set forth in section 4.3(c) hereof, no other corporate proceedings on
the part of Buyer or CSI are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Buyer and CSI and constitutes a valid and
binding agreement of Buyer and CSI, enforceable against Buyer and CSI in
accordance with its terms, subject to the laws of general application affecting
the rights and remedies of creditors and the availability of equitable
remedies.
3.3 Consents and Approvals: No Violation. Except as set forth in
Schedule 3.3 hereof, there is no requirement applicable to Buyer or CSI to make
any filing with, or to obtain any permit, authorization, consent or approval
of, any governmental or regulatory authority as a condition to lawful
consummation by Buyer of
6
<PAGE> 8
the purchase of the Stock pursuant to this Agreement. The execution and
delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby will not, violate, conflict with or result in a default
under (including any right of termination or acceleration) any provisions
(including provisions requiring any consent or approval) of any charter,
by-law, mortgage, note, indenture, lien, order, judgment, decree, or of any
material lease, agreement or instrument, to which Buyer or CSI is a party or by
which Buyer or CSI is bound, and will not violate any other restriction of any
kind or character to which Buyer or CSI is subject.
3.4 Capital Stock. The authorized capital stock of CSI consists of
500,000 shares of $0.04 par value, so-called "blank check" preferred stock of
which no shares are issued or outstanding, and 10,000,000 shares of $0.04 par
value Common Stock, of which approximately 6,700,000 shares are issued and
outstanding as of the date of this Agreement. All such issued and outstanding
shares are, and the Closing Shares for which the Stock and Notes will be
exchanged will be, duly authorized, validly issued and fully paid and
nonassessable. The Closing Shares to be issued to the Stockholders will be
free and clear of any pledges, liens, security interests, encumbrances or
charges of any nature whatsoever, except for transfer restrictions under the
securities laws. Except as disclosed in Schedule 3.4 hereto, there are no
outstanding or existing options, preemptive rights, warrants, subscriptions,
convertible securities, conversion rights, calls or commitments of any kind
obligating CSI to issue additional shares of CSI Common Stock. CSI has no
outstanding commitments or obligations to repurchase, reacquire or redeem any
of its outstanding Common Stock other than pursuant to transactions effected in
the open market at market prices.
3.5 Financial Statements. CSI has furnished to Stockholder audited
balance sheets as of June 30, 1993 and June 30, 1994 and the related audited
statements of income and retained earnings and cash flows of CSI for each of
the years ended on such dates together with the reports of Deloitte & Touche
thereon (such audited financial statements including the notes thereto are
collectively referred to herein as the "CSI Financial Statements"). The CSI
Financial Statements are true and correct in all material respects, fairly
present the financial position and operations and cash flows of CSI in
conformity with GAAP as of the dates and for the periods indicated, contain and
reflect all necessary adjustments for fair presentation of CSI's financial
condition and results of operations as of the dates and for the periods
indicated.
3.6 Absence of Certain Changes or Events. Except as set forth in Schedule
3.6, since June 30, 1994, CSI and its subsidiaries taken as a whole have not
suffered any material adverse change in their financial condition or results of
operations, or in their assets, properties, business or operations.
3.7 No Material Omissions. As of their respective filing dates, the CSI
SEC Reports contained in the CSI Disclosure Package did not contain any untrue
7
<PAGE> 9
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not misleading. No
representation or warranty by CSI contained herein or in any writing furnished
to Stockholder contains any untrue statement of a material fact or omits to
state any material fact necessary in order to make the statements contained
herein and therein, in light of the circumstances under which such statements
were made, not misleading.
3.8 Pending Litigation; Contingencies. To the knowledge of CSI and except
as set forth on Schedule 3.8 to this Agreement, there are no actions, suits,
proceedings or formal inquiries before any court, arbitration or regulatory
agency or governmental body pending against CSI which could reasonably be
expected to have a material adverse effect on its financial condition,
business, operation or assets, taken as a whole and CSI is not subject to any
outstanding orders, writs, injunctions or decrees which in the aggregate
materially and adversely affect the financial condition, business, operation or
assets of CSI taken as of a whole.
3.9 Accredited Investor. CSI is an "accredited investor" (as such term is
defined in Rule 501(a) promulgated under the Securities Act and has such
knowledge and experience in financial and business matters that it is capable
of evaluating the merits and risks of its purchase of the Stock and Notes which
are to be exchanged for the Closing Shares and is able to bear the substantial
economic risks of the investment in the Stock.
3.10 Purchase for Investment Only. The Stock is being acquired by Buyer
solely for its own account, for investment, with no present intention of making
a public distribution thereof within the meaning of the Securities Act. The
Stock will not be sold or transferred by Buyer in violation of the Securities
Act or any state or other jurisdiction's securities laws and the financial
condition of Buyer is such that the investment in the Stock can be made on a
long-term basis. Buyer is aware that the Stock has not been registered under
the Securities Act or any state or other jurisdiction's securities laws, that
the Stock purchased hereby must be held indefinitely unless subsequently
registered or an exemption from such registration is secured and that Immtech
is not under any obligation to register any of the Stock under the Securities
Act or any state or other jurisdiction's securities law.
3.11 Independent Evaluation of Immtech and Full Disclosure. In deciding
whether to acquire the Stock, CSI has relied upon consultations with CSI's
legal, financial and tax advisers with respect to this Agreement and the nature
of its investment and has reviewed the information provided to it by
Stockholder prior to the execution hereof. CSI has not relied upon any
representations of the Stockholders with respect to its investment, except as
specifically set forth in this Agreement.
8
<PAGE> 10
ARTICLE 4
CLOSING
4.1 General. The Closing shall take place at 4 p.m. on October 27, 1995,
at the offices of Reinhart, Boerner, Van Deuren, Norris & Rieselbach, s.c., or
at such other time, date or place as shall be mutually agreed upon by the
parties (the "Closing").
4.2 Conditions Precedent to Obligations of Each Party. The obligations of
each party arising under this Agreement to be performed at the Closing are
subject to the fulfillment at or prior to the Closing of each of the following
conditions:
(a) Buyer and Stockholders shall have obtained all consents and
approvals necessary to the consummation of this Agreement and the transactions
contemplated hereby.
(b) There shall be no action, proceeding or litigation pending which
seeks to enjoin, restrain or prohibit the consummation of the transactions
contemplated by this Agreement (other than actions which do not have a
reasonable likelihood of success).
4.3 Conditions Precedent to Obligations of Buyer. The obligations of
Buyer arising under this Agreement to be performed at the Closing are subject
to fulfillment at or prior to the Closing of each of the following conditions:
(a) Each of the representations and warranties of Stockholders
contained in this Agreement shall have been true and correct as of the date of
this Agreement and as of the Closing (as if made as of the Closing).
(b) Stockholders shall have used their reasonable best efforts to
cause Immtech to permit Buyer and its representatives full access during
normal business hours to all of its properties, books, tax returns, contracts
and records of Immtech, and to provide all documents and information with
respect to its affairs, as may be reasonably requested by Buyer or its
representatives.
(c) Buyer shall have obtained the requisite approval by its
stockholders of the transactions contemplated hereby.
(d) Stockholders shall have complied with section 4.5.
4.4 Conditions Precedent to Obligations of Stockholders. The obligations
of Stockholders arising under this Agreement to be performed at the Closing are
subject to fulfillment at or prior to the Closing of each of the following
conditions:
9
<PAGE> 11
(a) Each of the representations and warranties of Buyer contained in
this Agreement shall be true and correct as of the date of this Agreement and as
of the Closing (as if made as of the Closing).
(b) Buyer shall have complied with section 4.6.
(c) CSI and Stockholders shall have entered into a registration rights
agreement (the "Registration Rights Agreement") which, upon registration of the
Closing Shares in accordance therewith, will allow Stockholders (or their
respective partners) to sell the Closing Shares issued to them under this
Agreement in market transactions from time to time for a period of two years
after the effective date of such registration statement, subject to certain
limitations, including a provision limiting aggregate sales by Stockholders and
their partners during each calendar month to the greater of (i) 1% of the
outstanding CSI Common Stock or (ii) the average weekly trading volume of CSI
Common Stock during the preceding calendar month. The Registration Rights
Agreement will require that the registration statement be filed with the SEC
promptly following a request by the Stockholders and shall contain such other
provisions as the parties may mutually agree.
4.5 Actions by Stockholders. At the Closing, Stockholders shall deliver
or cause to be delivered to Buyer in form and substance acceptable to Buyer,
each of the following instruments or materials, duly executed:
(a) Certificates representing the Stock accompanied by stock powers
duly executed in blank and the Notes.
(b) An assignment of all of Stockholders' rights under the Ancillary
Agreements.
(c) The certificate of Stockholders, dated the date of the Closing, to
the effect that: (i) Stockholders are in compliance with all the terms,
covenants and conditions contained in this Agreement on their part to be
complied with; and (ii) all representations and warranties of Stockholders
contained in this Agreement were true and correct when made and are true and
correct as of the Closing date except as to changes required or contemplated by
this Agreement.
(d) The opinion of counsel to Stockholders, Kirkland & Ellis,
reasonably satisfactory to Buyer, and subject to customary assumptions and
exceptions, dated the date of the Closing, to the effect that:
(i) Stockholders have the power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby;
and the execution and delivery of this Agreement and the consummation of the
transactions
10
<PAGE> 12
contemplated hereby have been duly authorized by requisite action on the part
of Stockholders;
(ii) Immtech is a corporation existing and in good standing under
the laws of the State of Delaware;
(iii) The delivery of certificates representing the Stock
accompanied by stock powers duly executed in blank will be in a form effective
to vest in Buyer all of the right, title and interest of Stockholders in the
Stock, free and clear of all liens, encumbrances, restrictions and claims
arising prior to the Closing;
(iv) The assignment by Stockholders will be in form effective to
vest in Buyer all of the right, title and interest of Stockholders in the
Ancillary Agreements.
(v) The Agreement has been executed and delivered by Stockholders
and (assuming the valid authorization, execution and delivery of the Agreement
by Buyer) is a valid and binding agreement of the Stockholders enforceable
against the Stockholders in accordance with its terms, (a) except that such
enforcement may be subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights, and (b) except that the remedies of specific performance and
injunctive and other forms of equitable relief are subject to certain equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought; and
(vi) The execution, delivery and performance of this Agreement by
the Stockholders will not constitute a violation of the instruments pursuant to
which the partnerships were created and are existing.
As to any matter contained in such opinion which involves the laws
of any jurisdiction other than the federal laws of the United States, the
limited partnership law of the State of Delaware or the laws of the State of
Illinois, such counsel may assume that such laws are identical to those of
the State of Illinois. All opinions may expressly rely as to matters of fact
upon certificates furnished by Stockholders, appropriate officers and directors
of Immtech or public officials.
(e) All other documents, instruments and writings required to be
delivered by Stockholders at or prior to the Closing pursuant to this Agreement
or as may be otherwise required in connection herewith.
4.6 Actions by Buyer. At the Closing, Buyer shall deliver or cause to be
delivered to Stockholders, in form and substance acceptable to Stockholders,
each of the following instruments or materials, duly executed:
11
<PAGE> 13
(a) Certificates representing the Closing Shares issued in the name of
Stockholders.
(b) A certificate executed by the President or any Executive or Senior
Vice President of Buyer to the effect that: (i) Buyer is in compliance with all
the terms, covenants and conditions contained in this Agreement on its part to
be complied with; and (ii) all representations and warranties of Buyer contained
in this Agreement were true and correct when made and are true and correct as of
the Closing date.
(c) The opinion of counsel to Buyer, Reinhart, Boerner, Van Deuren,
Norris & Rieselbach, s.c., reasonably satisfactory to the Stockholders, and
subject to customary assumptions and exceptions, dated the date of the Closing,
to the effect that:
(i) Each of Buyer and CSI is a corporation organized, existing and
in good standing under the laws of its jurisdiction of incorporation and has the
power and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby; and the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have been
duly authorized by requisite corporate action taken on the part of Buyer and
CSI;
(ii) This Agreement has been executed and delivered by Buyer and
CSI and (assuming the valid authorization, execution and delivery of this
Agreement by Stockholders) is a valid and binding agreement of Buyer and CSI,
enforceable against Buyer and CSI in accordance with its terms, (a) except that
such enforcement may be subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights, and (b) except that the remedies of specific performance and
injunctive and other forms of equitable relief are subject to certain equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought;
(iii) The execution, delivery and performance of this Agreement by
Buyer and CSI will not constitute a violation of the Articles of Incorporation
or By-Laws (or other similar charter document), as currently in effect, of Buyer
and CSI;
(iv) The Closing Shares have been validly issued, fully paid and are
nonassessable except as set forth in Wisconsin Statutes section 180.0622(2)(b);
and
(v) The Registration Rights Agreement has been executed and
delivered by CSI and (assuming the valid authorization, execution and delivery
of the Registration Rights Agreement by Stockholders) is a valid and binding
agreement of CSI enforceable against CSI in accordance with its terms, (a)
except that such enforceability
12
<PAGE> 14
may be subject to bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditor's rights and (b)
except that the remedy of specific performance and injunctive and other forms
equitable relief are subject to certain equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
As to any matter contained in such opinion which involves the
laws of any jurisdiction other than the federal laws of the United States, the
corporate law of the State of Delaware, or the laws of the State of Wisconsin,
such counsel may assume that such laws are identical to those of the State of
Wisconsin. All opinions may expressly rely as to matters of fact upon
certificates furnished by appropriate officers and directors of Buyer or public
officials.
(d) All other documents, instruments and writings required to be
delivered by Buyer at or prior to the Closing pursuant to this Agreement or as
may be otherwise required in connection herewith.
4.7 Simultaneous Action. All actions taken at the Closing shall be deemed
to occur simultaneously.
ARTICLE 5
TERMINATION AND ABANDONMENT
5.1 Termination. This Agreement may be terminated at any time prior to
the Closing:
(a) by mutual consent of Stockholder and Buyer;
(b) at any time after October 31, 1995 by Marquette Venture Partners
II, L.P. ("MVP") unless Stockholders are not in compliance with their
obligations under Article 6 hereof;
(c) by MVP if (i) a meeting of CSI's stockholders to consider and vote
on the transactions contemplated by this Agreement has not been held on or prior
to October 26, 1995, or (ii) if a meeting of CSI's stockholders is held for such
purpose, but CSI's stockholders fail to approve such transactions;
(d) by Buyer if (i) CSI holds a meeting of its stockholders to consider
and vote upon the transactions contemplated by this Agreement, but CSI's
stockholders fail to approve such transactions or (ii) there has been a material
violation or breach by Stockholders of any agreement, representation or warranty
contained in this Agreement which has rendered the satisfaction of any condition
or the obligations of
13
<PAGE> 15
Buyer or CSI impracticable and such violation or breach has not been waived by
the Buyer; or
(e) by Stockholders, if there has been a material violation or breach
by Buyer of any agreement, representation or warranty contained in this
Agreement which has rendered the satisfaction of any condition to the
obligations of Stockholders impracticable and such violation or breach has not
been waived by Stockholders.
5.2 Effect of Termination. Notwithstanding anything herein to the
contrary, if this Agreement is terminated due to a party's or parties' failure
to comply with its obligations hereunder through no fault of the other party,
the breaching party shall be liable to the nonbreaching party for the
reasonable damages incurred by the nonbreaching party as a result of such
breach.
ARTICLE 6
MISCELLANEOUS
6.1 Stockholder Approval. CSI shall take all reasonable action necessary
to duly call, give notice of and hold an annual meeting of its stockholders by
October 26, 1995, in accordance with applicable law, to consider and vote upon
this Agreement and the transactions contemplated hereby, and CSI shall
diligently pursue the approval of its stockholders of this Agreement and the
transactions contemplated hereby. In connection with the annual meeting, CSI
shall prepare and cause to be mailed to its stockholders a notice of the Annual
Meeting and a definitive proxy statement no later than the time required by law
and the Certificate of Incorporation and By-Laws of CSI. In such proxy
statement, CSI shall indicate that the Board of Directors has approved the
Agreement and recommends that stockholders vote for its approval.
6.2 Interim Financing. If, between the date of this Agreement and the
Closing, Immtech needs additional working capital, CSI agrees that it will lend
up to $100,000 to Immtech when, if and as needed. If CSI does not acquire the
Stock and Notes from Stockholders (provided that such failure does not
constitute a breach by CSI or Buyer of this Agreement), Stockholders will
reimburse CSI for 34% of the advances made by CSI to Immtech pursuant to this
section. In the event of such reimbursement, Stockholders shall be subrogated
to CSI's rights vis-a-vis Immtech with respect to such amount.
14
<PAGE> 16
6.3 Public Announcements. Stockholders and Buyer will consult with each
other before issuing any press releases or otherwise making any public
statements with respect to this Agreement and the transactions contemplated
hereby and shall not issue any such press release or make any such public
statement prior to such consultation; provided that nothing herein shall
preclude Buyer from making timely releases or public statements as its counsel
determines are required by law. The Stockholders shall use their best efforts
to cause Immtech and its independent public accountant to make available to
Buyer such financial statements, information and consents as Buyer may
reasonably request to permit Buyer to prepare and timely file with the
Securities and Exchange Commission a Current Report on Form 8-K with respect to
the transactions contemplated by the Agreement.
6.4 Investigations: No Survival of Representations and Warranties. The
respective representations and warranties of Stockholders and Buyer contained
herein or in any certificates, schedules or other documents delivered prior to
or at the Closing shall not be deemed waived or otherwise affected by any
investigation made by any party hereto. Each and every such representation and
warranty shall expire with, and be terminated and extinguished by, (i) the
Closing, or (ii) the termination of this Agreement pursuant to section 5.1 or
otherwise. Upon either such event, none of the Stockholders, Buyer or any
officer, director, trustee or affiliate of any of them shall be under any
liability whatsoever with respect to any such representation or warranty.
6.5 Satisfaction of Conditions Precedent: Further Actions. Each party
shall cooperate with the other parties hereto and use its or his reasonable
best efforts to satisfy each of the conditions precedent to the accomplishment
of the transactions contemplated by this Agreement. Buyer and Stockholders
shall, without further consideration, execute and deliver, or cause to be
executed and delivered, any further or additional instruments and perform any
acts which may become reasonably necessary in order to effectuate and carry out
the purposes of this Agreement.
6.6 Expenses. All expenses incurred by CSI, Buyer or Stockholders
(including fees of counsel and accountants) in connection with the preparation
of this Agreement and the transactions contemplated hereby shall be borne by
the party incurring the same.
6.7 Attorneys' Fees. In the event either party hereto institutes an
action or other proceeding to enforce any rights arising under this Agreement,
the party prevailing in such action or other proceeding shall be paid all
reasonable costs and attorneys' fees by the other party, such fees to be set by
the court or arbitrators, as the case may be, and not by a jury and to be
included in any judgment entered in such proceeding.
15
<PAGE> 17
6.8 Severability. In the event any term or provision of this Agreement is
declared to be invalid or illegal, for any reason, this Agreement shall remain
in full force and effect and the same shall be interpreted as though such
invalid and illegal provision were not a part hereof.
6.9 Notices. Any notice or communication to be given under the terms of
this Agreement ("Notice") shall be in writing and shall be personally delivered
or sent by telex or mail. Notice shall be effective (i) if personally
delivered, when delivered; (ii) if by facsimile transmission, upon transmission
thereof on a proper facsimile machine with confirmed answer back; and (iii) if
mailed, at midnight on the fourth business day after deposit in the mail with
airmail postage prepaid. Notices shall be addressed as follows:
If to Buyer: Criticare Biomedical, Inc.
c/o Criticare Systems, Inc.
Attn: Gerhard J. Von der Ruhr,
Chairman of the Board, Treasurer
and President
20925 Crossroads Circle
Waukesha, WI 53186
414-798-8282-telephone
414-798-8290-facsimile
With copy to: Robert E. Bellin, Esq.
Reinhart, Boerner, Van Deuren,
Norris & Rieselbach, s.c.
1000 North Water Street, Suite 2100
P.O. Box 92900
Milwaukee, WI 53202-0900
414-298-1000-telephone
414-298-8097-facsimile
If to Stockholders: c/o Marquette Venture Partners II, L.P.
520 Lake Cook Road
Deerfield, IL 60015
Attn: Lloyd D. Ruth
708-940-1700-telephone
708-940-1724-facsimile
16
<PAGE> 18
With copy to: Keith S. Crow, Esq.
Kirkland & Ellis
200 East Randolph Drive
Chicago, IL 60601
312-861-2000-telephone
312-861-2200-facsimile
or at such other address as a party may from time to time designate by Notice
hereunder.
6.10 Modification and Amendments. No provision of this Agreement may be
modified or amended except by a writing executed by the party sought to be
charged with such modification or amendment.
6.11 Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of any other provision of this Agreement. The failure to a party to
insist upon strict adherence to any term of this Agreement on one or more
occasions shall not be considered a waiver or deprive that party of the right
thereafter to insist upon strict adherence to that term or any other term of
this Agreement. Any waiver shall be effective only if in writing and executed
by the party sought to be charged with such waiver.
6.12 Entire Agreement. This Agreement, together with the Confidentiality
Agreement and any other and further documents executed and delivered at the
Closing, constitutes and embodies the full and complete understanding and
agreement of the parties hereto and supersedes all prior understandings or
agreements whether oral or in writing other than the Confidentiality Agreement.
6.13 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without regard to conflicts
of law principles.
6.14 Headings: Interpretation. The section headings and Article headings
used herein are for convenience and reference only and are not intended to
define, limit or describe the scope or intent of any provision of this
Agreement. When used in this Agreement, (i) the term "including" shall mean
without limitation by reason of enumeration, (ii) the term "person" shall mean
an individual, a partnership, a joint venture, a corporation, a trust, or
unincorporated organization and a governmental entity or any department
thereof, (iii) the term "subsidiary" when used in reference to any other person
shall mean any corporation of which outstanding securities having ordinary
voting power to elect a majority of the Board of Directors of such corporation
are owned directly or indirectly by such other person, and (iv) the term
"affiliate" shall have the meaning set forth in Rule 12b-2 of the General Rules
and Regulations promulgated under the Securities Exchange Act of 1934, as
amended. The definition of a term in the plural
17
<PAGE> 19
form shall include the singular form, and the singular the plural, as the
context requires. Any masculine personal pronoun shall be considered to mean
the corresponding feminine personal pronoun, as the context requires.
6.15 Successors. Neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by any party hereto without the
prior written consent of the other party, nor is this Agreement intended to
confer upon any person other than the parties hereto any rights or remedies
hereunder. Subject to the foregoing, this Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
personal representatives, successors or assigns, as the case may be.
6.16 Brokers and Agents. No party hereto has dealt with any agent,
finder, broker or other representative in any manner which could result in any
party hereto being liable for any fee or commission in the nature of a finder's
fee or originator's fee in connection with the subject matter hereof. Each
party agrees to indemnify and hold the other parties hereto harmless from and
against any claims by any broker or finder for any fee or expense which is
based in any way on an agreement, arrangement or understanding made or alleged
to have been made by such party relating to the transactions contemplated
hereby.
6.17 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed a duplicate original.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
18
<PAGE> 20
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the _____ day of ___________________, 1995.
BUYER:
CRITICARE BIOMEDICAL, INC.
BY__________________________________
Its________________________________
STOCKHOLDERS:
MARQUETTE VENTURE PARTNERS, II., L.P.
BY__________________________________
Its________________________________
MVP II AFFILIATES FUND, L.P.
BY__________________________________
Its________________________________
CRITICARE SYSTEMS, INC.
BY__________________________________
Its________________________________
19
<PAGE> 21
SCHEDULE A
MARQUETTE VENTURE PARTNERS II
IMMTECH SECURITIES HOLDINGS
AT JULY 27, 1995
<TABLE>
<CAPTION>
DATE NUMBER PRINCIPAL
DESCRIPTION ACQUIRED OF SHARES AMOUNT
- ------------------------ -------- -------------- ---------
<S> <C> <C> <C>
Series A Preferred Stock 12/31/92 1,000,000 (B) N/A
Series B Preferred Stock 10/26/93 600,000 (B) N/A
Series B Preferred Stock 02/14/94 600,000 (B) N/A
Promissory Note (A) 12/16/94 N/A $50,000
-------------- ---------
Totals 2,200,000 $50,000
============== =========
</TABLE>
(A) Maturity date is September 30, 1995.
(B) Each share of preferred equals one common stock equivalent.
Note: Above holdings are all in the name of Marquette Venture Partners II;
however, they have been paid for and therefore been recorded on the
books of both MVP II and MVP II affiliates.
Note: Per the MVP II March 31, 1995 quarterly write-up, total CSE's of Immtech
at March 31, 1995 were 6,801,000 meaning MVP II's 2.2 MM shares would
own 32.4% of the Company.
Note: MVP II Affiliate Fund hold 2.778% of each position.
<PAGE> 22
AMENDMENT TO
STOCK PURCHASE AND SALE AGREEMENT
BY THIS AMENDMENT to Stock Purchase and Sale Agreement (the "Amendment"),
CRITICARE SYSTEMS, INC., a Delaware corporation ("CSI"), through its wholly
owned subsidiary CRITICARE BIOMEDICAL, INC., a Wisconsin corporation ("Buyer"),
and MARQUETTE VENTURE PARTNERS II, L.P. and MVP II AFFILIATES FUND, L.P.
("Stockholders") hereby represent, warrant, covenant and agree as follows:
RECITALS
A. The parties hereto are parties to a certain Stock Purchase and Sale
Agreement dated as of the first day of August 1995 (the "Agreement").
B. The parties desire to amend the Agreement as provided in this
Amendment.
C. Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Agreement.
AGREEMENTS
In consideration of the recitals and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:
1. Purchase Price. Notwithstanding any provisions of the Agreement to the
contrary, Buyer shall pay the purchase price for the Stock and the Notes by
delivering to Stockholders:
(a) 333,154 shares of the $.04 par value Common Stock of CSI; and
(b) the promissory note of Buyer in the aggregate principal amount of
$1,240,000 in the form attached hereto as Exhibit A (the "Note").
2. Closing Shares. The 333,154 shares of CSI Common Stock to be issued to
the Stockholders pursuant hereto shall be considered the "Closing Shares" for
purposes of the Agreement and, accordingly, the terms and conditions
<PAGE> 23
of the Agreement, other than those set forth in section 1.2 of the Agreement,
shall apply to the 333,154 shares.
3. Representations and Warranties. Each of the parties hereto as of the
date hereof reaffirms each of the representations and warranties made by it in
the Agreement and represents and warrants that such representations and
warranties are true and correct as of the date hereof.
4. Other Amendments to the Agreement. Sections 5.1(c), 5.1(d)(i) and 6.1
of the Agreement are deleted in their entirety and are of no further force and
effect.
5. Remaining Terms and Conditions of the Agreement. Except as amended
hereby, the remaining terms, conditions, covenants and agreements of the
Agreement shall continue in full force and effect and shall be unaffected by
this Amendment.
6. Mutual Release. By execution of this Amendment, CSI and Buyer, on the
one hand, and Stockholders, on the other hand, release each other from and
against any and all liabilities, costs, damages and expenses of any kind or
nature, whether accrued, contingent or otherwise, arising out of, in connection
with or relating to the Agreement other than a breach of the representations,
warranties or covenants made by the respective parties under the Agreement, as
amended by this Amendment.
7. Miscellaneous. No provision of this Amendment may be modified or
amended except by a writing executed by the party sought to be charged with
such modification or amendment. This Amendment constitutes and embodies the
full and complete understanding and agreement of the parties hereto and
supersedes all prior understandings or agreements, whether oral or in writing,
other than the Agreement and the Confidentiality Agreement, as amended hereby.
This Amendment shall be governed by and construed and enforced in accordance
with the laws of the State of Delaware without regard to conflicts of law
principles. Neither this Amendment nor any of the rights, interests or
obligations hereunder shall be assigned by any party hereto without the prior
written consent of the other party, nor is this Amendment intended to confer
upon any person other than the parties hereto any rights or remedies hereunder.
Subject to the foregoing, this Amendment shall be binding upon and shall inure
to the benefit of the parties hereto and their respective heirs, personal
representatives, successors or assigns, as the case may be. This Amendment may
be executed in any number of
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<PAGE> 24
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same agreement.
Dated as of October ___, 1995.
BUYER:
CRITICAL BIOMEDICAL, INC.
BY______________________________
Its____________________________
CRITICARE SYSTEMS, INC.
BY______________________________
Its____________________________
STOCKHOLDERS:
MARQUETTE VENTURE PARTNERS II, L.P.
BY______________________________
Its____________________________
MVP II AFFILIATES FUND, L.P.
BY______________________________
Its____________________________
4
<PAGE> 25
EXHIBIT A
PROMISSORY NOTE
$1,240,000 ____________, 1995
The undersigned, CRITICARE BIOMEDICAL, INC., a Wisconsin corporation
("Buyer") promises to pay to MARQUETTE VENTURE PARTNERS II, L.P. and MVP II
AFFILIATES FUND, L.P. ("Stockholders") at _______________________, the
principal sum of $1,240,000, plus simple interest accruing on the outstanding
balance from time to time at the rate of 7% per year from the date hereof until
paid in full. The principal balance of this Note shall be payable in one lump
sum on the first to occur of (a) the seventh anniversary of the date of this
Note; (b) the date of closing an initial public offering of the stock of
Immtech International, Inc. ("Immtech") which nets Immtech at least $5 million
of proceeds; (c) the date of closing a sale of any Immtech stock by Buyer; or
(d) the date of closing any acquisition of any additional Immtech stock by
Criticare Systems, Inc. Interest under this Note shall be payable quarterly on
March 31, June 30, September 30 and December 31 of each year commencing with
the December 31, 1996 payment. Buyer shall not sell or transfer the Stock of
Immtech (as defined in that certain Stock Purchase and Sale Agreement dated as
of the first day of August, 1995 by and among Criticare Systems, Inc., the
undersigned and Stockholders, as amended) unless this Note is paid in full or
unless Stockholders otherwise consent.
Payment of this Subordinated Note is secured by a pledge of 2,200,000
shares of stock of Immtech purchased by Buyer from Stockholders pursuant to a
certain Stock Purchase and Sale Agreement dated as of August 1, 1995, as
amended by a certain Amendment to Stock Purchase and Sale Agreement of even
date herewith. Stockholders' sole recourse upon any default in payment of
principal or interest under this Note shall be to foreclose on the Stock and
seek recourse against any other assets of Buyer. Stockholders are aware that,
at present, Buyer's sole asset is the Stock of Immtech purchased by Buyer from
Stockholders. Stockholders acknowledge and agree that they shall have no
recourse against Criticare Systems, Inc. or any other party other than Buyer
upon Buyer's default under this Note.
This Note may be prepaid in whole or in part at any time without penalty.
Partial prepayments shall be applied against installments of principal in the
order of their maturities.
This Note is intended to be performed in and shall be governed by the laws
of the State of Wisconsin. Stockholders shall hold the Stock as collateral
and, upon Buyer's default under this Note, shall be entitled to the rights of a
secured creditor under the Uniform Commercial Code. Prior to any such default,
the undersigned shall be treated as the owner of the Stock and shall be
entitled to exercise all rights of ownership, including voting the Stock.
<PAGE> 26
CRITICARE BIOMEDICAL, INC.
BY______________________________
Its____________________________
2
<PAGE> 1
EXHIBIT 5
<PAGE> 2
February 9, 1996
Criticare Systems, Inc.
20925 Crossroads Circle
Waukesha, Wisconsin 53186
Gentlemen: Re: Registration Statement on Form S-3
We have acted as counsel for Criticare Systems, Inc., a Delaware
corporation (the "Company"), in connection with the Company's registration of
333,154 shares (the "Shares") of its $.04 par value common stock at the request
of Marquette Venture Partners II, L.P. and MVP II Affiliates Fund, L.P.
In such capacity we have examined, among other documents, the Restated
Certificate of Incorporation of the Company, as amended, a certificate of good
standing issued by the Secretary of State of the State of Delaware and the
Registration Statement on Form S-3 to be filed by the Company with the
Securities and Exchange Commission on or shortly after the date of this letter
covering the sale by Marquette Venture Partners II, L.P. and MVP II Affiliates
Fund, L.P. of the Shares. Based on the foregoing and such additional
investigation as we have deemed necessary, it is our opinion that:
1. The Company is a corporation existing in good standing under the laws
of the State of Delaware.
2. The Shares are legally issued, fully-paid and nonassessable, except as
set forth in Wisconsin Statutes section 180.0622(2)(b) as interpreted.
We consent to the filing of a copy of this opinion as an exhibit to the
Registration Statement on Form S-3.
REINHART, BOERNER, VAN DEUREN,
NORRIS & RIESELBACH, s.c.
BY /s/ Robert E. Bellin
-------------------------
Robert E. Bellin
<PAGE> 1
EXHIBIT 23.1
<PAGE> 2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Criticare Systems, Inc. on Form S-3 of our reports dated August 1, 1995,
appearing and incorporated by reference in the Annual Report on Form 10-K of
Criticare Systems, Inc. for the year ended June 30, 1995, and to the reference
to us under the heading "Experts" in the Prospectus, which is part of such
Registration Statement.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Milwaukee, Wisconsin
February 9, 1996
3
