-----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, OQiS+y65iUn5gVGsKi83xmboopj2guGydP9aMNSt9o09OE4yzWjjJMwsOCDTb5WE 48/KL91soUJ8LB9EsGPPbA== 0000912057-01-005474.txt : 20010223 0000912057-01-005474.hdr.sgml : 20010223 ACCESSION NUMBER: 0000912057-01-005474 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20010214 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: BIOSPHERE MEDICAL INC CENTRAL INDEX KEY: 0000919015 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 043216867 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: SEC FILE NUMBER: 005-48675 FILM NUMBER: 1540554 BUSINESS ADDRESS: STREET 1: 1050 HINGHAM STREET CITY: ROCKLAND STATE: MA ZIP: 02370 BUSINESS PHONE: 7816817900 MAIL ADDRESS: STREET 1: 1050 HINGHAM STREET CITY: ROCKLAND STATE: MA ZIP: 02370 FORMER COMPANY: FORMER CONFORMED NAME: BIOSEPRA INC DATE OF NAME CHANGE: 19940215 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SEPRACOR INC /DE/ CENTRAL INDEX KEY: 0000877357 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 222536587 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 111 LOCKE DR CITY: MARLBOROUGH STATE: MA ZIP: 01757 BUSINESS PHONE: 5084816700 SC 13D 1 a2037767zsc13d.txt SCHEDULE 13D SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D (RULE 13D-101) UNDER THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. ____)1 BIOSPHERE MEDICAL, INC. (NAME OF ISSUER) COMMON STOCK, PAR VALUE $.01 PER SHARE (TITLE OF CLASS OF SECURITIES) 09066V 10 3 (CUSIP NUMBER) TIMOTHY J. BARBERICH CHIEF EXECUTIVE OFFICER SEPRACOR INC. 111 LOCKE DRIVE MARLBOROUGH, MASSACHUSETTS 01752 (508) 481-6700 - ------------------------------------------------------------------------------- (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS) MARCH 29, 1996 - ------------------------------------------------------------------------------- (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 Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. | | NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (1)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). CUSIP NO. 09066V 10 3 Page 2 of 8 Pages - ------------------------------------------------------------------------------- (1) NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Sepracor Inc. 22-2536587 - ------------------------------------------------------------------------------- (2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* N/A - ------------------------------------------------------------------------------- (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) N/A - ------------------------------------------------------------------------------- (6) CITIZENSHIP OR PLACE OF ORGANIZATION State of Delaware - ------------------------------------------------------------------------------- NUMBER OF SHARES (7) SOLE VOTING POWER BENEFICIALLY OWNED 5,824,334 shares BY EACH REPORTING -------------------------------------------------- PERSON WITH (8) SHARED VOTING POWER 0 shares -------------------------------------------------- (9) SOLE DISPOSITIVE POWER 5,824,334 -------------------------------------------------- (10) SHARED DISPOSITIVE POWER 0 shares - ------------------------------------------------------------------------------- (11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,824,334 shares - ------------------------------------------------------------------------------- (12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* N/A - ------------------------------------------------------------------------------- (13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 56% - ------------------------------------------------------------------------------- (14) TYPE OF REPORTING PERSON* CO - ------------------------------------------------------------------------------- *SEE INSTRUCTION BEFORE FILLING OUT! - ------------------------------------------------------------------------------- Neither the filing of this Schedule 13D nor any of its contents shall be deemed to constitute an admission by Sepracor Inc. that it is the beneficial owner of any of the Common Stock referred to herein for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the "Act"), or for any other purpose, and such beneficial ownership is expressly disclaimed. CUSIP NO. 09066V 10 3 Page 3 of 8 Pages ITEM 1. SECURITY AND ISSUER. This statement on Schedule 13D relates to the Common Stock, $0.01 par value per share ("Issuer Common Stock"), of BioSphere Medical, Inc., a Delaware corporation ("BioSphere" or "Issuer"). The principal executive offices of BioSphere are located at 1050 Hingham Street, Rockland, Massachusetts 02370. ITEM 2. IDENTITY AND BACKGROUND. The name of the corporation filing this statement is Sepracor Inc., a Delaware corporation ("Sepracor"). Sepracor's principal business is the development and commercialization of potentially improved versions of widely-prescribed drugs. The address of the principal executive offices of Sepracor is 111 Locke Drive, Marlborough, Massachusetts 01752. Set forth on SCHEDULE A is the name, residence or business address, citizenship and present principal occupation or employment of each of Sepracor's directors and executive officers (the "Schedule A Persons"). Also set forth on SCHEDULE A is the name, principal business and address of any corporation or other organization in which employment of each Schedule A Person is conducted, as of the date hereof. All Schedule A Persons are U.S. citizens, except as otherwise indicated on SCHEDULE A. Neither Sepracor nor, to Sepracor's best knowledge, any Schedule A Person is required to disclose legal proceedings pursuant to Items 2(d) or 2(e). ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. (a) Sepracor purchased 1,369,788 shares of Issuer Common Stock in June 1996 (the "1996 Purchase") for $5,547,641, as further described in Item 4 below. (b) Sepracor purchased 454,545 shares of Issuer Common Stock in July 2000 (the "2000 Purchase") for $4,999,995, as further described in Item 4 below. Sepracor used its working capital to fund each of the 1996 Purchase and the 2000 Purchase. ITEM 4. PURPOSE OF TRANSACTION. (a) THE 1996 PURCHASE. Sepracor and the Issuer entered into an Agreement, dated as of March 29, 1996 (the "Loan Agreement"), providing for, among other things, (i) a loan by Sepracor to the Issuer of up to $5,500,000 and (ii) the issuance by the Issuer to Sepracor of a Convertible Subordinated Note in the principal amount of $5,500,000 (the "Note"). On June 10, 1996, Sepracor converted the outstanding principal, plus accrued interest, of the Note into an aggregate of 1,369,788 shares of Issuer Common Stock. The foregoing summary of the 1996 Purchase is qualified in its entirety by reference to the full text of each of the Loan Agreement and the Note, which are included as Exhibits 7(a) and 7(b), respectively, to this Schedule 13D. CUSIP NO. 09066V 10 3 Page 4 of 8 Pages (b) THE 2000 PURCHASE. The Issuer entered into a Stock Purchase Agreement, dated as of July 28, 2000 (the "Stock Purchase Agreement"), with Sepracor and several other investors named therein (the "Other Investors"). Under the terms of the Stock Purchase Agreement, Sepracor purchased an aggregate of 454,545 shares of Issuer Common Stock for an aggregate purchase price of $4,999,995. The foregoing summary of the 2000 Purchase is qualified in its entirety by reference to the full text of the Stock Purchase Agreement, which is included as Exhibit 7(c) to this Schedule 13D. Sepracor currently holds its interest in the Issuer for investment purposes. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. (a) Sepracor and the Schedule A Persons may be deemed to beneficially own an aggregate of 5,936,554 shares of Issuer Common Stock. Based on the 10,480,922 shares of Issuer Common Stock that were issued and outstanding on November 9, 2000 (as indicated on the Issuer's Quarterly Report on Form 10-Q for the quarter ended September 30, 2000), the 5,936,554 shares beneficially owned by Sepracor and the Schedule A Persons, calculated in accordance with Rule 13d-3 of the Exchange Act, represent 56.6% of the issued and outstanding shares of Issuer Common Stock. (b) Sepracor has the sole power to vote, or to direct the vote of 5,824,334 shares and the sole power to dispose of, or to direct the disposition of 5,824,334 shares of Issuer Common Stock. The Schedule A Persons each have sole power to vote, or to direct the voting of, and sole power to dispose of, or to direct the disposition of, the shares of Issuer Common Stock each is deemed to beneficially own, as set forth on SCHEDULE A, except as otherwise indicated on SCHEDULE A. (c)-(e) Not applicable. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Except as described below and in Items 3 and 4 above, there are no contracts, arrangements, understandings or relationships (legal or otherwise) among the persons named in Item 2 above and between such persons and any other person with respect to any securities of the Issuer. In connection with the 2000 Purchase, the Issuer, Sepracor and the Other Investors entered into a registration rights agreement, dated as of July 28, 2000 (the "Registration Rights Agreement"), which provides for registration under the Securities Act of 1933, as amended, of the shares of Issuer Common Stock purchased by Sepracor and the Other Investors under the Stock Purchase Agreement. The foregoing summary of the terms of the Registration Rights Agreement is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is included as Exhibit 7(d) to this Schedule 13D and is incorporated herein by reference. In connection with the purchase and sale of certain shares of Issuer common stock and of Issuer warrants, the Issuer entered into a stock and warrant purchase agreement, dated as of February 4, 2000 (the "Stock and Warrant Purchase Agreement"), with Timothy Barberich and David Southwell, each a Schedule A Person, and several other investors named therein. In connection with this same transaction, the Issuer entered into a warrant agreement, dated as of February 4, 2000 (the "Warrant Agreement"), with Mr. Barberich, Mr. Southwell and several other investors named therein. The foregoing summary of the terms of the Stock and Warrant Purchase Agreement and the Warrant Agreement is qualified in its entirety by reference to the full text of each of the Stock and Warrant Purchase Agreement and the Warrant Agreement, which are included as Exhibits 7(e) and 7(f) to this Schedule 13D and are incorporated herein by reference. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. The following documents are filed as exhibits: a. Agreement, dated as of March 29, 1996, between the Issuer and Sepracor b. Convertible Subordinated Note dated March 29, 1996, made by the Issuer in favor of Sepracor CUSIP NO. 09066V 10 3 Page 5 of 8 Pages c.* Stock Purchase Agreement, dated as of July 28, 2000, by and among the Issuer and the several purchasers named on Exhibit A attached thereto. d.* Registration Rights Agreement, dated as of July 28, 2000, by and among the Issuer and the individuals listed on Exhibit A attached thereto. e.**Stock and Warrant Purchase Agreement, dated as of February 4, 2000 between the Issuer and the individuals listed on the Schedule of Purchasers attached thereto. f.**Warrant Agreement, dated as of February 4, 2000, between the Issuer and the individuals listed on the Schedule of Purchasers attached thereto. * Incorporated herein by reference from the Issuer's Quarterly Report on Form 10-Q for the quarter ended June 30, 2000. **Incorporated by reference from the Issuer's Annual Report on Form 10-K for the year ended December 31, 1999. CUSIP NO. 09066V 10 3 Page 6 of 8 Pages SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I hereby certify that the information set forth in this statement is true, complete and correct. DATED: February 13, 2001 SEPRACOR INC. By: /s/ Robert F. Scumaci ----------------------------------------- Robert F. Scumaci Title: Senior Vice President, Finance and Administration, and Treasurer CUSIP NO. 09066V 10 3 Page 7 of 8 Pages Schedule A
NAME BUSINESS ADDRESS SHARES OF ISSUER BENEFICIALLY OWNED EXECUTIVE OFFICERS OF SEPRACOR Timothy J. Barberich 111 Locke Drive 78,777 Chairman of the Board and Chief Marlborough, MA 01752 Executive Officer William J. O'Shea 111 Locke Drive 0 President and Chief Operating Marlborough, MA 01752 Officer David Southwell 111 Locke Drive 13,943 Executive Vice President, Marlborough, MA 01752 Chief Financial Officer and Secretary Paul D. Rubin, M.D. 111 Locke Drive 0 Executive Vice President, Marlborough, MA 01752 Drug Development & ICE Research James R. Hauske, Ph.D 111 Locke Drive 0 Senior Vice President, Discovery Marlborough, MA 01752 Douglas E. Reedich, Ph.D, J.D. 111 Locke Drive 0 Senior Vice President, Marlborough, MA 01752 Legal Affairs and Chief Patent Counsel Robert F. Scumaci 111 Locke Drive 18,500 Senior Vice President, Marlborough, MA 01752 Finance & Administration and Treasurer DIRECTORS OF SEPRACOR (PRESENT PRINCIPAL OCCUPATION) James G. Andress Warner Chilcott, PLC 0 (Chief Executive Officer, 100 Enterprise Drive, Warner Chilcott, PLC) Suite 280 Rockaway, NJ 07866 Timothy J. Barberich 111 Locke Drive See above Chairman of the Board and Marlborough, MA 01752 Chief Executive Officer
CUSIP NO. 09066V 10 3 Page 8 of 8 Pages Digby W. Barrios 44 St. John's Road 1,000 Ridgefield, CT 06877 Robert J. Cresci Pecks Management Partners 0 (Managing Director, One Rockefeller Plaza Pecks Management Partners) Suite 320 New York, NY 10020 Keith Mansford Mansford Associates 0 (Principal, Mansford Nine Cavendish Road Associates) Redhill, Surrey RH 1 4AL Citizenship: United Kingdom England James F. Mrazek Four Corners Venture Fund 0 (President and Managing 6336 N. Oracle Road Partner, Four Corners Suite 326-328 Venture Fund) Tucson, AZ 85704 Alan A. Steigrod Newport HealthCare Ventures 0 (Managing Director, Newport 601 Lido Park Drive, #7A HealthCare Ventures) Newport Beach, CA 92663
EX-99.1 2 a2037767zex-99_1.txt EXHIBIT 99.1 Exhibit A AGREEMENT This Agreement between Sepracor Inc. ("Sepracor") and BioSepra Inc. ("BioSepra") has been entered into as of March 29, 1996. A. THE LOANS. 1. DESCRIPTION OF THE LOANS. 1.1. LOANS. Sepracor agrees to loan to BioSepra on and as of the date hereof a principal amount of $3,500,000. In addition, Sepracor agrees to loan to BioSepra from time to time until March 29, 1997, such sums (being a multiple of $1,000,000) as BioSepra shall request but which shall not exceed in the aggregate principal amount $2,000,000. Any loan made hereunder not repaid or converted pursuant to Section 3 herein by March 29, 2000 (the "Maturity Date") shall be due and payable on the Maturity Date. 1.2. THE NOTE. (a) The loans made hereunder shall be evidenced by a single Note, in the form of EXHIBIT A (the "Note"), payable to Sepracor and dated as of the date hereof. (b) Sepracor shall, and is hereby irrevocably authorized by BioSepra to, endorse on the schedule forming a part of the Note or otherwise in its records appropriate notations evidencing the date and the amount of each loan made pursuant to Section 1.1 (each of which will be evidenced by the Note) and the date and amount of each payment of principal made by BioSepra with respect thereto. No failure on the part of Sepracor to make any endorsement of a notation as provided in this subsection (b) shall in any way affect any loan made hereunder or the obligations of Sepracor or BioSepra with respect thereto. 1.3. INTEREST. The loans hereunder shall accrue and bear interest at a rate per annum set forth in the Note (the "Interest Rate"). On the Maturity Date of the Note (unless payment is accelerated pursuant to Section 4 herein), if any portion of the interest has not been converted by Sepracor pursuant to Section 3 herein, BioSepra will pay to Sepracor the full amount of the accrued but unpaid interest. 1.4. PREPAYMENT OF PRINCIPAL AND INTEREST. The principal indebtedness represented by this Note and interest accrued but unpaid thereon may not be prepaid. 1.5. PAYMENT AT MATURITY. On the Maturity Date of the Note (unless such payment is accelerated pursuant to Section 4 herein), if any portion of the Loans has not been converted by Sepracor pursuant to Section 3 herein, BioSepra will pay to Sepracor an amount equal to the indebtedness evidenced by the Note then due, together with all accrued and unpaid interest thereon and all obligations in respect thereof then outstanding. 1.6. METHOD OF PAYMENT. All payments of principal and interest shall be made at Sepracor's principal executive offices in immediately available funds, free and clear of, or deduction or withholding for, any taxes or other payments. 1.7. SUBORDINATION. (a) The indebtedness evidenced by the Note, and the payment of the principal thereof, and any interest thereon, is wholly subordinated, junior and subject in right of payment, to the extent and in the manner hereinafter provided, to the prior payment of all Senior Indebtedness of BioSepra now outstanding or hereinafter incurred. "Senior Indebtedness" means the principal of, and premium, if any, and interest on all indebtedness of BioSepra for monies borrowed from banks, trust companies, and other financial institutions, including commercial paper and accounts receivable sold or assigned by BioSepra to such institutions. Nothing in this Section 1.7 shall impair, as between BioSepra and Sepracor, the obligation of BioSepra, which is unconditional and absolute, to pay to Sepracor the principal thereof and interest thereon, in accordance with the terms of the Note, nor shall anything herein prevent Sepracor from exercising all remedies otherwise permitted by applicable law or hereunder upon default, subject to the rights set forth above of holders of Senior Indebtedness to receive cash, property or securities (other than securities of BioSepra issuable upon conversion) otherwise payable or deliverable to Sepracor. (b) Subject to the terms of this Agreement, BioSepra may make payments of the principal of, and any interest or premium on, this Note, if at the time of payment, and immediately after giving effect thereto, (i) there exists no default in any payment with respect to any Senior Indebtedness and (ii) there shall not have occurred an event of default (other than a default in the payment of amounts due thereon) with respect to any Senior Indebtedness, as defined in the instrument under which the same is outstanding, permitting the holders thereof to accelerate the maturity thereof, other than an event of default which shall have been cured or waived or shall have ceased to exist. 2. CONDITIONS TO REVOLVING LOAN. The obligation of Sepracor to make the loans hereunder shall be subject to receipt by Sepracor of the executed Note. 3. CONVERSION. 3.1. GENERAL. The Note shall be subject to optional conversion by Sepracor. Sepracor shall have the right, at any time and from time to time, to convert the outstanding principal amount of the note and interest accrued and unpaid thereon into fully paid and non-assessable shares of Common Stock, $.01 par value per share (the "Common Stock"), of BioSepra at the rate (the "Conversion Rate") of one share of Common Stock for principal and unpaid interest thereon in an amount equal to $4.05 per share (the "Conversion Price") pursuant to this Section 3.1. Sepracor shall send written notice (the "Notice") of its intent to convert to BioSepra at its principal executive office together with the Note. The Notice shall also state the name or names (with address) in which the certificate or certificates for shares of Common Stock shall be issued. 3.2. SURRENDER OF NOTE AND DELIVERY OF CERTIFICATES. When surrendered for conversion the Note shall, unless the shares issuable upon conversion are to be issued in the same name as the name in which the Note is then registered, be duly endorsed by, or accompanied by instruments of transfer in form reasonably satisfactory to BioSepra duly executed by Sepracor or its duly authorized attorney. As promptly as practicable after the -2- surrender of the Note for conversion and the receipt of the notice specified above, BioSepra shall deliver or cause to be delivered at its principal executive office to Sepracor, or on Sepracor's written order, a certificate or certificates for the number of full shares issuable upon the conversion of the Note, or portion hereof, in accordance with the provision hereof. Such conversion shall be deemed to have been made upon the date of the Notice (the "Conversion Date") and Sepracor shall be deemed to have become on the Conversion Date the holder of record of the securities represented thereby. If less than the entire outstanding principal amount of the Note is being converted, a new Note shall promptly be delivered to Sepracor for the unconverted principal balance and shall be of like tenor as to all terms as the Note surrendered. 3.3. CONSOLIDATION OR MERGER. If, prior to conversion of the Note, BioSepra shall at any time consolidate or merge with another corporation (other than a merger or consolidation in which (i) BioSepra is the surviving corporation, and (ii) shares of stock of BioSepra are neither exchanged for or converted into nor represent the right to receive consideration as a result of the merger or consolidation), the right of Sepracor to convert the Note pursuant to this Section 3 shall terminate immediately prior to such merger or consolidation. 3.4. FRACTIONAL SHARES. No fractional shares of Common Stock shall be issuable upon conversion of the Note, but a payment in cash will be made in respect of any fraction of a share which would otherwise be issuable upon the surrender of the Note, or portion hereof, for conversion. Such payment shall be based on the fair market value of the Common Stock at the time of conversion of the Note, as determined in good faith by the Board of Directors. 3.5. RIGHT TO CONVERT. Subject to the provisions of subsection 3.3 above and the other terms and conditions of this Agreement, Sepracor shall have the right to convert any amount outstanding under the Note at any time up to and including the Maturity Date (or such earlier date if the Note is accelerated pursuant to Section 4 herein), in whole and in part. 3.6. SECURITIES ACT OF 1933; REGISTRATION RIGHTS. (a) Upon conversion of the Note, Sepracor agrees to execute and deliver to BioSepra an instrument, in form satisfactory to BioSepra, representing that the shares issuable upon conversion hereof are being acquired for investment and not with a view to distribution within the meaning of the Securities Act of 1933, as amended. (b) REGISTRATION RIGHTS. 1. At any time after BioSepra becomes eligible to file a Registration Statement on Form S-3 (or any successor form relating to secondary offerings), Sepracor may request BioSepra, in writing, to effect the registration on Form S-3 (or such successor form), of shares of BioSepra Common Stock having an aggregate offering price of at least $5,000,000 (based on the then current public market price). If Sepracor intends to distribute the shares of BioSepra Common Stock by means of an underwriting, Sepracor shall so advise BioSepra in its request. Upon receipt of any such request, BioSepra shall as expeditiously as possible use its best efforts to effect the registration on Form S-3 (or such successor form) of all shares of BioSepra Common Stock which Sepracor has been requested to so register. -3- 2. BioSepra shall not be required to effect more than two registrations in accordance with this Section of the Agreement. If at the time of any request to register shares of BioSepra Common Stock pursuant to this Section of the Agreement, BioSepra is engaged in any other activity which, in the good faith determination of BioSepra's Board of Directors, would be adversely affected by the requested registration to the material detriment of BioSepra, then BioSepra may at its option direct that such request be delayed for a period not in excess of six months from the date of commencement of such other material activity, such right to delay a request to be exercised by BioSepra not more than once in any two-year period. Sepracor shall pay all of the expenses of any such registration. 4. DEFAULT. Subject to the subordination provisions of Section 1.7, the entire unpaid principal of this Note and the interest then accrued on this Note shall become and be immediately due and payable upon written demand of Sepracor, without any other notice or demand of any kind or any presentment or protest, if any one of the following events ("Events of Default") shall occur and be continuing at the time of such demand, whether voluntarily or involuntarily, or, without limitation, occurring or brought about by operation of law or pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any governmental body: (a) If BioSepra (i) makes a composition or an assignment for the benefit of creditors or trust mortgage, (ii) applies for, consents to, acquiesces in, files a petition seeking or admits (by answer, default or otherwise) the material allegations of a petition filed against it seeking the appointment of a trustee, receiver or liquidator, in bankruptcy or otherwise, of itself or of all or a substantial portion of its assets, or a reorganization, arrangement with creditors or other remedy, relief or adjudication available to or against a bankrupt, insolvent or debtor under any bankruptcy or insolvency law or any law affecting the rights of creditors generally, or (iii) admits in writing its inability to pay its debts generally as they become due; or (b) If an order for relief shall have been entered by a bankruptcy court or if a decree, order or judgment shall have been entered adjudging BioSepra insolvent, or appointing a receiver, liquidator, custodian or trustee, in bankruptcy or otherwise, for it or for all or a substantial portion of its assets, or approving the winding-up or liquidation of its affairs on the grounds of insolvency or nonpayment of debts, and such order for relief, decree, order or judgment shall remain undischarged or unstayed for a period of sixty (60) days; or if any substantial part of the property of BioSepra is sequestered or attached and shall not be returned to the possession of BioSepra or such subsidiary released from such attachment within sixty (60) days. 5. COVENANTS OF BIOSEPRA. BioSepra agrees to maintain sufficient authorized capital stock to permit conversion of the Loan, or any portion thereof, to Common Stock during the term of this Agreement. -4- 6. GENERAL. 6.1. SUCCESSORS AND ASSIGNS. This Agreement, and the obligations and rights of each party hereunder, shall be binding upon and inure to the benefit of such party and their respective heirs, successors and assigns. 6.2. RECOURSE. Recourse under this Agreement and the Note shall be to the general unsecured assets of BioSepra only and in no event to the officers, directors or stockholders of BioSepra. 6.3. CURRENCY. All payments shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender therein for the payment of public and private debts. 6.4. NOTICES. All notices, requests, consents and demands shall be made in writing and shall be mailed postage prepaid, or delivered by hand, to BioSepra or to the holder hereof at their respective addresses set forth below or to such other address as may be furnished in writing to the other party hereto: If to Sepracor: Sepracor Inc. 33 Locke Drive Marlborough, MA 01752 Attention: President If to BioSepra: BioSepra Inc. 140 Locke Drive Marlborough, MA 01752 Attention: President 6.5. SATURDAYS, SUNDAYS, HOLIDAYS. If any date that may at any time be specified in this Agreement as a date for the making of any payment of principal or interest under the Note shall fall on Saturday, Sunday or on a day which in Boston, Massachusetts shall be a legal holiday, then the date for the making of that payment shall be the next subsequent day which is not a Saturday, Sunday or legal holiday. 6.6. FORCE MAJEURE. Neither party shall be liable hereunder for failure to carry out its obligations hereunder where such delay or failure shall have been due wholly or in part to the elements, acts of God, fires, floods, epidemics, riots, strikes, lockouts, or any other cause beyond its reasonable control. 6.7. GOVERNING LAW. This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the Commonwealth of Massachusetts. -5- IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed under seal and delivered as of the date first above written. SEPRACOR INC. By: /S/ TIMOTHY J. BARBERICH ________________________________ Timothy J. Barberich, President BIOSEPRA INC. By: /S/ JEAN-MARIE VOGEL ____________________________________ Jean-Marie Vogel, President -6- EX-99.2 3 a2037767zex-99_2.txt EXHIBIT 99.2 Exhibit B THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED UNLESS SO REGISTERED OR AN EXEMPTION FROM REGISTRATION UNDER SAID ACT IS AVAILABLE. No. 1 BIOSEPRA INC. Convertible Subordinated Note Due March 29, 2000 $5,500,000 Marlborough, Massachusetts March 29, 1996 ----------------------- BioSepra Inc., a Delaware corporation (the "Company"), for value received, hereby promises to pay Sepracor Inc. ("Sepracor"), or registered assigns, the principal sum of FIVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($5,500,000) on March 29, 2000, and to pay interest (computed on the basis of a 365-day year) from the date hereof on the unpaid balance of such principal amount from time to time outstanding at a rate per annum equal to the Current Sepracor Borrowing Rate (as defined below) less 1/2%, such interest to be due and payable on March 29, 2000. As used herein "Current Sepracor Borrowing Rate" shall mean the annual interest rate in effect from time to time payable by Sepracor to its primary commercial lender on its principal credit facility or, in the event Sepracor has no existing credit facility, the Prime Rate as set forth in THE WALL STREET JOURNAL from time to time. 1. REFERENCE TO LOAN AGREEMENT. The Note is issued pursuant to, and entitled to the benefits of, and is subject to the provisions of, the Agreement by and between the undersigned and Sepracor, dated March 29, 1996 (the "Agreement"), but neither this reference to the Agreement nor any provision thereof shall affect or impair the absolute and unconditional obligation of the undersigned maker of this Note to pay the principal and interest as provided herein. Terms defined in the Agreement and not otherwise defined in this Note are used herein with the meanings so defined. 2. CONVERSION. This Note is convertible on the terms set forth in the Agreement at the option of Sepracor. 3. PREPAYMENT. The Company may not prepay all or any portion of the principal of this Note before maturity. 4. ACCELERATION. In case an Event of Default (as defined in the Agreement) shall occur, the aggregate unpaid principal of, plus accrued interest on, this Note shall become or may be declared to be due and payable in the manner and with the effect provided in the Agreement. THIS INSTRUMENT SHALL HAVE THE EFFECT OF AN INSTRUMENT EXECUTED UNDER SEAL AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. BIOSEPRA INC. By:/S/ JEAN-MARIE VOGEL -------------------- Name: Jean-Marie Vogel Title: President ATTEST: /S/ TIMOTHY J. BARBERICH - --------------------------- Name: Title: 2 SCHEDULE I TO NOTE DATE AMOUNT OF LOAN AMOUNT PAID 3 -----END PRIVACY-ENHANCED MESSAGE-----