-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H94oMAc0D9k6KKp7e5EiyzZj3jc9sXKypVHkggzInRQ3LuTrd/zECWyXKBqSNUkI 3AUR3FB721zmw+eUSdvuSg== 0000950136-02-002744.txt : 20020925 0000950136-02-002744.hdr.sgml : 20020925 20020925170029 ACCESSION NUMBER: 0000950136-02-002744 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20020925 GROUP MEMBERS: LARRY N. FEINBERG GROUP MEMBERS: ORACLE ASSOCIATES, LLC GROUP MEMBERS: ORACLE INVESTMENT MANAGEMENT, INC. GROUP MEMBERS: ORACLE PARTNERS, L.P. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: NOVOSTE CORP /FL/ CENTRAL INDEX KEY: 0001012131 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 592787476 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-49664 FILM NUMBER: 02772279 BUSINESS ADDRESS: STREET 1: 3890 STEVE REYNOLDS BLVD CITY: NORCROSS STATE: GA ZIP: 30093 BUSINESS PHONE: 7707170904 MAIL ADDRESS: STREET 1: 4350 C INTERNATIONAL BLVD CITY: NORCROSS STATE: GA ZIP: 30093 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: FEINBERG LARRY N CENTRAL INDEX KEY: 0000926475 STATE OF INCORPORATION: NY FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: C/O ORACLE PARTNERS L P STREET 2: 712 FIFTH AVENUE 45TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2125741286 MAIL ADDRESS: STREET 1: C/O ORACLE PARTNERS L P STREET 2: 712 FIFTH AVE 45TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10019 SC 13D 1 file001.txt SCHEDULE 13D UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 NOVOSTE CORPORATION - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, par value $0.01 per share - -------------------------------------------------------------------------------- (Title of Class of Securities) 67010C100 - -------------------------------------------------------------------------------- (CUSIP Number) Robert L. Lawrence, Esq. Kane Kessler, P.C. 1350 Avenue of the Americas, 26th Floor New York, NY 10019 (212) 541-6222 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) September 24, 2002 - -------------------------------------------------------------------------------- (Date of Event which requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box /X/. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). SCHEDULE 13D - -------------------------- ----------------------- CUSIP No. 67010C100 Page 2 of 11 - -------------------------- -----------------------
- ------------------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Larry N. Feinberg - ------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [X] - ------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - ------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) [ ] - ------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - ------------------------------------------------------------------------------------------------------------------- 7 SOLE VOTING POWER 0 ------------------------------------------------------------------------------------ NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 1,587,105 OWNED BY ------------------------------------------------------------------------------------ EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON 0 WITH ------------------------------------------------------------------------------------ 10 SHARED DISPOSITIVE POWER 1,587,105 - ------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,587,105 - ------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.7% - ------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT! SCHEDULE 13D - -------------------------- ---------------------------- CUSIP No. 67010C100 Page 3 of 11 - -------------------------- ----------------------------
- ------------------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Oracle Investment Management, Inc. - ------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [X] - ------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - ------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) [ ] - ------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - ------------------------------------------------------------------------------------------------------------------- 7 SOLE VOTING POWER 0 ------------------------------------------------------------------------------------------- NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 1,581,105 OWNED BY ------------------------------------------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON 0 WITH ------------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,581,105 - ------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,581,105 - ------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 9.7% - ------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO - -------------------------------------------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT! SCHEDULE 13D - ---------------------------- -------------------------------- CUSIP No. 67010C100 Page 4 of 11 - ---------------------------- --------------------------------
- ------------------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Oracle Partners, L.P. - ------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [X] - ------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - ------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) [ ] - ------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - ------------------------------------------------------------------------------------------------------------------- 7 SOLE VOTING POWER 1,031,705 NUMBER OF ------------------------------------------------------------------------------------------- SHARES 8 SHARED VOTING POWER BENEFICIALLY OWNED BY 0 EACH ------------------------------------------------------------------------------------------- REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH 1,031,705 ------------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 0 - ------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,031,705 - ------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.3% - ------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN - -------------------------------------------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT! SCHEDULE 13D - ----------------------------- ------------------------------- CUSIP No. 67010C100 Page 5 of 11 - ----------------------------- -------------------------------
- ------------------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Oracle Associates, LLC - ------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [X] - ------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - ------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(E) [ ] - ------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - ------------------------------------------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY 0 OWNED BY ------------------------------------------------------------------------------------------- EACH 8 SHARED VOTING POWER REPORTING PERSON 1,292,405 WITH ------------------------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ------------------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,292,405 - ------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 1,292,405 - ------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.9% - ------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* OO - -------------------------------------------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT! Page 6 of 11 Item 1. Security and Issuer. (i) Name of Issuer: Novoste Corporation (the "Company"). (ii) Address of the Principal Executive Offices of Issuer: 3890 Steve Reynolds Blvd., Norcross, Georgia 30093. (iii) Title of Class of Equity Securities to which this Statement relates: Common Stock, $0.01 par value per share, of the Company (the "Common Stock"). Item 2. Identity and Background. (a) This Schedule 13D is being filed by: (i) Oracle Investment Management, Inc., a Delaware corporation (the "Investment Manager"), which serves as investment manager to and has investment discretion over the securities held by Oracle Partners, L.P., a Delaware limited partnership ("Oracle Partners") (1,031,705 shares), Oracle Institutional Partners, L.P., a Delaware limited partnership ("Oracle Institutional") (260,700 shares), SAM Oracle Investments Inc., a British Virgin Islands corporation ("SAM Oracle") (92,600 shares), Oracle Offshore Limited, a Cayman Islands corporation ("Oracle Offshore") (182,100 shares) and Oracle Investment Management, Inc. Employees Retirement Plan (the "Plan") (14,000 shares) (Oracle Partners, Oracle Institutional, SAM Oracle, Oracle Offshore and the Plan are collectively referred to as the "Managed Funds"), with respect to shares of Common Stock directly owned the Managed Funds. (ii) Oracle Associates, LLC, a Delaware limited liability company ("Oracle Associates"), which serves as the general partner of Oracle Partners and Oracle Institutional (collectively, the "Partnerships"), with respect to shares of common stock directly owned by the Partnerships. (iii) Oracle Partners, with respect to the shares of Common Stock directly owned by Oracle Partners. (iv) Mr. Larry N. Feinberg ("Mr. Feinberg"), who serves as the senior managing member of Oracle Associates, is the sole shareholder and president of the Investment Manager and is the trustee of The Feinberg Family Foundation (6,000 shares), with respect to shares of Common Stock owned by virtue of the foregoing relationships. The Investment Manager, Oracle Associates, Oracle Partners and Mr. Feinberg are sometimes collectively referred to as the "Reporting Persons." (b) The business address of each of the Reporting Persons is: Oracle Investment Management, Inc. 200 Greenwich Avenue 3rd Floor Greenwich, CT 06830 Page 7 of 11 (c) (i) The principal business of the Investment Manager is to serve as investment manager to, and have investment discretion over, the securities held by the Managed Funds. (ii) The principal business of Oracle Associates is to serve as general partner of the Partnerships. (iii) Oracle Partners is a private investment fund. (iv) The present principal occupation of Mr. Feinberg is to invest in securities through Oracle Associates, the Investment Manager and certain other entities. (d) None of the Reporting Persons has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) None of the Reporting Persons was, during the last five years, a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) Mr. Feinberg is a citizen of the United States. The Investment Manager, Oracle Partners and Oracle Associates are organized under the laws of the State of Delaware. Item 3. Source and Amount of Funds or Other Consideration. As of the date hereof, the Reporting Persons may be deemed to beneficially own 1,587,105 shares of the Company's Common Stock (the "Shares"). The Shares are held by the Managed Funds and the Foundation and were purchased for an aggregate purchase price of $12,671,750. The funds for the purchase of the Shares came from the working capital of the Managed Funds and the Foundation. Although none of the Managed Funds or the Foundation borrowed money specifically to purchase the Shares, some of the Shares were purchased through securities margin accounts. Item 4. Purpose of Transaction. The primary interest of the Reporting Persons is to maximize the value of the Managed Funds' and the Foundation's investment in the Company. In furtherance of the foregoing, the Reporting Persons are seeking representation on the Board of Directors of the Company. The Reporting Persons intend to continually review the Company's business affairs, financial position, and future prospects, as well as conditions in the securities markets and general economic and industry conditions. Based on such evaluation, review, and other factors, the Reporting Persons will continue to consider various alternative courses of action and will in the future take such actions with respect Page 8 of 11 to the Managed Funds' and the Foundation's investments in the Company as they deem appropriate. Such actions may include, but are not limited to, the following: 1. Seeking other changes to the Board of Directors, and/or management of the Company; 2. Seeking changes to the Company's charter and bylaws to eliminate the staggered Board of Directors and rights plan provisions; 3. Making recommendations to management concerning various business strategies, including mergers, acquisitions, dispositions, recapitalizations, sales or transfers of assets, reorganization, liquidation or other extraordinary transactions; and 4. Recommending hiring an investment banker to evaluate strategies to enhance shareholder value. Such actions may also involve the purchase of additional shares of Common Stock and, alternatively, may involve the sale of all or a portion of the Shares held by the Managed Funds or the Foundation in the open market or in privately negotiated transactions to one or more financial or strategic purchasers. As a result of the foregoing, the Reporting Persons' position with respect to the Company may not be considered solely that of passive investors. There can be no assurance, however, that the Reporting Persons will take any of the actions set forth above. Item 5. Interest in Securities of the Issuer. (a-b) (i) Mr. Feinberg ------------ (a) Amount beneficially owned: 1,587,105 (represents shares beneficially owned by the Investment Manager, Oracle Associates and the Foundation) (b) Percent of class: 9.7% (c) Number of shares as to which such person has: (i) Sole power to vote or direct the vote: -0- (ii) Shared power to vote or direct the vote: 1,587,105 (iii) Sole power to dispose or direct the disposition: -0- (iv) Shared power to dispose or direct the disposition: 1,587,105 (ii) The Investment Manager ---------------------- (a) Amount beneficially owned: 1,581,105 (represents shares owned by the Managed Funds) (b) Percent of class: 9.7% (c) Number of shares as to which such person has: (i) Sole power to vote or direct the vote: -0- (ii) Shared power to vote or direct the vote: 1,581,105 (iii) Sole power to dispose or direct the disposition: -0- Page 9 of 11 (iv) Shared power to dispose or direct the disposition: 1,581,105 (iii) Oracle Partners --------------- (a) Amount beneficially owned: 1,031,705 (b) Percent of class: 6.3% (c) Number of shares as to which such person has: (i) Sole power to vote or direct the vote: 1,031,705 (ii) Shared power to vote or direct the vote: -0- (iii) Sole power to dispose or direct the disposition: 1,031,705 (iv) Shared power to dispose or direct the disposition: -0- (iv) Oracle Associates ----------------- (a) Amount beneficially owned: 1,292,405 (represents shares beneficially owned by the Partnerships) (b) Percent of class: 7.9% (c) Number of shares as to which such person has: (i) Sole power to vote or direct the vote: -0- (ii) Shared power to vote or direct the vote: 1,292,405 (iii) Sole power to dispose or direct the disposition: -0- (iv) Shared power to dispose or direct the disposition: 1,292,405 The percentage of Common Stock reported as beneficially owned is based upon 16,346,173 shares outstanding as reported by the Company on Form 10-Q for the quarter ended June 30, 2002. (c) The Reporting Persons, the Managed Funds and the Foundation did not effect any transactions in the Common Stock during the past 60 days, except for the following: # of Shares Date Purchase/Sale Average Cost Per Share - ----------- ---- ------------- ---------------------- 21,080 7/29/2002 Purchase $ 4.2882 20,000 7/29/2002 Purchase 4.7902 13,800 7/30/2002 Purchase 3.6202 5,100 7/30/2002 Purchase 4.05 13,100 7/31/2002 Purchase 4.4792 15,000 8/8/2002 Purchase 4.3619 20,000 8/19/2002 Purchase 3.8025 18,000 8/30/2002 Purchase 4.1234 2,000 9/3/2002 Sale 4.41 (d) No person, other than the Reporting Persons, the Managed Funds and the Foundation, has the right to receive or the power to direct the receipt of dividends from, or proceeds from the sale of the Common Stock reported by this statement. Page 10 of 11 (e) Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships with respect to Securities of the Issuer. Not applicable. Item 7. Material to be Filed as Exhibits. Exhibit 1 - Joint Filing Agreement Exhibit 2 - Letter dated September 24, 2002 from Kane Kessler, P.C., counsel to the Reporting Persons, to the Company Page 11 of 11 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: September 24, 2002 /s/ Larry N. Feinberg --------------------------------------- Larry N. Feinberg ORACLE INVESTMENT MANAGEMENT, INC. By: /s/ Larry N. Feinberg ----------------------------------- Name: Larry N. Feinberg Title: President ORACLE PARTNERS, L.P. By: Oracle Associates, LLC, its general partner By: /s/ Larry N. Feinberg ----------------------------------- Name: Larry N. Feinberg Title: Managing Member ORACLE ASSOCIATES, LLC By: /s/ Larry N. Feinberg ----------------------------------- Name: Larry N. Feinberg Title: Managing Member EX-1 3 file002.txt JOINT FILING AGREEMENT EXHIBIT 1 SCHEDULE 13D JOINT FILING AGREEMENT The undersigned and each other person executing this joint filing agreement (this "Agreement") agree that each of the undersigned is responsible for the timely filing of this statement and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained herein or therein; but none of the undersigned is responsible for the completeness or accuracy of the information statement concerning any other persons making the filing, unless such person knows or has reason to believe that such information is inaccurate. In Witness Whereof, the undersigned have either signed this Agreement or caused this Agreement to be signed by their respective officers thereunto duly authorized as of the date set forth below. Date: September 24, 2002 /s/ Larry N. Feinberg --------------------------------------- Larry N. Feinberg ORACLE INVESTMENT MANAGEMENT, INC. By: /s/ Larry N. Feinberg ----------------------------------- Name: Larry N. Feinberg Title: President ORACLE PARTNERS, L.P. By: Oracle Associates, LLC, its general partner By: /s/ Larry N. Feinberg ----------------------------------- Name: Larry N. Feinberg Title: Managing Member ORACLE ASSOCIATES, LLC By: /s/ Larry N. Feinberg ----------------------------------- Name: Larry N. Feinberg Title: Managing Member EX-2 4 file003.txt DANIEL G. HALL, ESQ. LETTER EXHIBIT 2 Kane Kessler P.C. 1350 Avenue of the Americas New York, New York 10019 (212) 519-5103 rlawrence@kanekessler.com September 24, 2002 VIA FEDERAL EXPRESS - ------------------- Daniel G. Hall, Esq. Vice President, Secretary and General Counsel Novoste Corporation 3890 Steve Reynolds Boulevard Norcross, Georgia 30093 Dear Mr. Hall: We are counsel to Oracle Partners, L.P. ("Oracle"), and have been asked to respond to your letter of August 16, 2002. While Oracle appreciates your efforts to respond to its letter to the Board of Directors of Novoste Corporation (the "Company" or "Novoste") of July 12, 2002, unfortunately, Oracle does not feel your responses adequately address its concerns. First, we reaffirm Oracle's primary objective of remaining a long-term investor in the Company, provided management's actions merit such commitment. As a significant stockholder of the Company, Oracle has watched its investment in the Company erode, in spite of its faith in the Company's products and technology. In order to maximize value for all stockholders, Oracle has expressed three concerns requiring immediate attention by the Board: (i) the prompt selection of a full-time chief executive officer who is experienced, both in the medical and business communities, (ii) the elimination of Board members who have common financial interests with the Company and the Weldons and who appear to be under the influence of Company management, and the election of truly independent Board members with business acumen; and (iii) resolution of various corporate governance issues, including the elimination of the Company's staggered board and rights plan. With respect to Oracle's first concern, Bill Hawkins resigned as President and Chief Executive Officer of the Company, effective January 15, 2002. As you accurately stated, Daniel G. Hall, Esq. September 24, 2002 Page 2 Thomas Weldon addressed the CEO search on July 30, 2002, more than six months after Mr. Hawkins' resignation. Six more weeks have passed since his last communication regarding this issue. While Oracle agrees that an "arbitrary deadline" is impractical for hiring a qualified CEO, nonetheless, Mr. Weldon did establish such an "arbitrary deadline" on his call of July 30, 2002 by stating that it is the Company's goal to successfully complete the recruitment of a new CEO by the end of this year. While the Company is taking a leisurely approach in its search, its stock price has declined approximately 60%. Investors view the Company as lacking leadership and strategic direction. Companies much larger than Novoste have successfully completed CEO searches in less time. Investors are questioning the motives of the Board and the senior management team in failing to resolve this problem promptly. Oracle believes that the market has discounted the Company's stock price in part as a result of the vacancy in the CEO position. Every effort must be made to complete the process promptly. Naturally, Oracle expects that the CEO will be accountable to the full Board, not to current management, including Norman or Thomas Weldon. With respect to Oracle's concerns over the Board's "independence", apparently your definition of director "independence" differs not only from theirs, but from that of a significant number of Novoste stockholders and the NYSE and Nasdaq, as well. As you know: Norman Weldon and Thomas Weldon are related; Thomas Weldon and Charles Larson are partners in an outside venture partnership; Stephen Shapiro received consulting payments from the Company during 2001; and Donald Harrison sits on board(s) of companies funded by Norman Weldon's Partisan Management Group. Five of nine directors of Novoste are not truly independent. Further, Donald Harrison is a member of the Audit Committee and one of two members of the Compensation Committee. It is not only inappropriate for one non-independent director to wield such oversight responsibilities, but, we believe, a violation of the spirit of the proposed NYSE and Nasdaq rules as well. Oracle applauds the addition of Judy Lindstrom to the Board as she appears to be independent of existing relationships and to have experience relevant to Novoste's opportunities. However, Oracle strongly advocates that the Board should be reduced in size and non-independent directors should resign. Lastly, Oracle believes that in order to maximize stockholder value, the Company must eliminate its staggered Board and its rights plan. Most significant institutional investors, independent watchdog groups, such as Institutional Shareholder Services, and the business press, including the Wall Street Journal, agree with Oracle's position that such devices serve only to entrench management and act as a detriment to enhancing shareholder value. To ensure that the matters set forth in this letter are given the due consideration they deserve, to assist the Company by offering Oracle's extensive expertise in the healthcare industry and to protect Oracle's sizable investment and the investment of the Company's other stockholders, Oracle requests that an Oracle representative be appointed to the Company's Board of Directors. Daniel G. Hall, Esq. September 24, 2002 Page 3 Kindly provide a copy of this letter to all directors. Should the Company fail to take the actions requested, Oracle reserves its right to pursue alternative actions, including, but not limited to, bringing its concerns to the Company's stockholders directly. Please be guided accordingly. Very truly yours, /s/ Robert L. Lawrence RLL:nc cc: Larry N. Feinberg -----END PRIVACY-ENHANCED MESSAGE-----