STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement"), dated as of ____ __, 1998
is entered into by and between __________________________, a __________
corporation with an address at __________________________________ (the
"Purchaser") and AgriBioTech, Inc., a Nevada corporation with an address at 0000
Xxxxxx Xxxx, Xxx Xxxxx, Xxxxxx 00000 (the "Company")
The Company has privately offered for sale, and the Purchaser has agreed to
purchase __________ shares (the "Shares") of Common Stock, par value of $.001
per share ("Common Stock"), of the Company on the terms and conditions herein
provided. In connection herewith, the Company and the Purchaser hereby agree as
follows:
1. Purchase and Sale of Shares. Upon the basis of the representations and
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warranties and subject to the terms and conditions set forth herein, the Company
agrees to issue and sell the Shares to the Purchaser on the Closing Date (as
herein defined) at $_____ per share, or an aggregate purchase price of
$___________ (the "Purchase Price") and, upon the basis of the representations
and warranties and subject to the terms and conditions set forth herein, the
Purchaser agrees to purchase the Shares from the Company on the Closing Date at
the Purchase Price. The Company and the Purchaser both acknowledge that the
Company will pay a sales agent's commission of 4 1/2% of the Purchase Price, or
an aggregate of $_________ to Xxxxxxx Xxxxx Xxxxxx in connection with the
purchase of the Shares.
2. Closing. The closing of the purchase and sale of the Shares shall
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take place at 10:00 a.m., New York City Time, on ____ __, 1998 as coordinated by
Snow Xxxxxx Xxxxxx P.C., the Company's counsel, or on such other date or at such
other time and place as the Company and the Purchaser may agree upon (such time
and date of the closing being referred to herein as the "Closing Date"). Upon
payment of the Purchase Price in full in immediately available funds by or on
behalf of the Purchaser to the Company by wire transfer to an account specified
by the Company to the Purchaser prior to the Closing Date, the Company will
promptly cause its transfer agent to deliver to the Purchaser within two
business days of the Closing Date a certificate or certificates representing the
Shares, in such denominations and registered in such names as the Purchaser
shall request.
3. Registration.
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(a) Within 30 days after the Closing Date, the Company will prepare
and file with the Securities and Exchange Commission ("Commission") a
registration statement on Form S-3 (including all exhibits thereto and all
information and documents incorporated by reference therein, the "Registration
Statement") with respect to a continuous offering of the Shares by the Purchaser
(and by holders of such other shares of Common Stock as the Company may
determine in its discretion) pursuant to Rule 415 under the Securities Act of
1933, as amended ("Act"), providing for sales of shares thereunder to be
effected through normal broker transactions, through market makers in the Common
Stock, in privately negotiated transactions or any combination thereof. The
Company will use its commercially reasonable best efforts to cause the
Registration Statement to
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be declared effective by the Commission within 120 days after the Closing Date
to remain effective under the Act for a period through the second anniversary of
the Closing Date, or the earlier of the date when all of the Shares have been
sold or withdrawn from registration by the Purchaser) ("Registration Period")
provided that such two-year period will be extended by the aggregate number of
days during which the Purchaser is prevented from selling Shares as a result of
Section 3(b) or 3(c) below, subject to the restrictions imposed on the Purchaser
from selling Shares during the Registration Period under this Section 3(a) or
under Section 3(b) or 3(c) below. From the Closing Date through the Registration
Period, the Purchaser will not sell any Shares under the Registration Statement
unless, at the time of sale, the Registration Statement (and the most recently
filed post-effective amendment thereto, if any) has been declared effective by
the Commission and no stop orders are in force or pending with respect thereto,
as advised by the Company.
(b) During the Registration Period, the Purchaser will notify the
Chief Executive Officer of the Company in writing at least three business days
prior to selling any Shares pursuant to the Registration Statement. If, within
two business days after receipt of such a notice, the Company advises the
Purchaser in writing that in its discretionary judgment (i) due to a change in
circumstances, a pending transaction or otherwise, the Registration Statement as
then in effect may contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances in which they
were made and (ii) the public disclosure required to correct such potential
material misstatement or omission would be injurious or detrimental to the
Company (financial or otherwise), then the Purchaser will refrain from selling
any Shares pursuant to the Registration Statement or otherwise for the period of
time, not to exceed 45 days in each instance, requested by the Company. The
Company will use its commercially reasonable efforts to minimize the time period
during which the Purchaser is required to refrain from selling Shares under this
paragraph and will advise the Purchaser promptly when such restrictions are no
longer in effect.
(c) If, during the Registration Period, the Company advises the
Purchaser on a confidential basis that it intends to commence an underwritten
public offering of its Common Stock on its own behalf or on behalf of selling
shareholders (exclusive of any offering of Common Stock to be issued (i) in
exchange for securities or assets of, or in connection with the merger, share
exchange, consolidation or other business combination involving another
corporation or entity or (ii) pursuant to any stock option, incentive
compensation, profit sharing or other employee benefit plan), then (in addition
to any other restrictions on sale of the Shares under this Agreement or the
federal laws then applicable to the Purchaser) the Purchaser will refrain from
selling Shares pursuant to the Registration Statement or otherwise for a period
of time beginning ten business days before the anticipated effective date with
the Commission of the Company's underwritten public offering (as disclosed by
the Company or its underwriters to the Purchaser) and ending 90 days after such
effective date. If the Company undertakes such underwritten public offering,
Purchaser will be given the opportunity to sell its shares in such offering in
pari passu with any selling shareholders, provided however, that the limitations
on sale of this Section 3(c) shall only be applicable to the first such
underwritten public offering undertaken by the Company.
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(d) During the Registration Period, if Purchaser desires to sell any
Shares under the Registration Statement, the Purchaser shall advise the Chief
Executive Officer of the Company in writing at least three business days prior
to such sale of the name of the person or entity for whose account the Shares
will be offered and sold, the number of shares of Common Stock owned by such
selling person or entity prior to the consummation of the proposed offering, the
number of Shares to be offered for such selling person's or entity's account and
the number of shares of Common Stock and (if one percent or more) the percentage
of the class to be owned by such selling person or entity after completion of
the offering, as well as any other related information required under the Act or
the rules and regulations thereunder so as to enable such offer and sale to be
made pursuant to the Registration Statement and sales of such Shares by the
Purchaser must be made by Purchaser in accordance with the Registration
Statement, as supplemented or amended. The Company will then promptly prepare
any required supplement to the prospectus constituting a part of the
Registration Statement containing the information described above and any other
required information which will be furnished to the relevant holder, for use in
connection with any such offer and sale. The Purchaser will otherwise promptly
furnish to the Company, at the Company's reasonable request, such other
information as is required in connection with the preparation of the
Registration Statement and any supplement required with respect to the
prospectus constituting a part thereof and will cooperate fully with the
reasonable requests of the Company, any underwriter or any broker-dealer in
respect of such sale.
(e) Promptly after the Closing Date, the Company shall take all
requisite action to list the Shares for trading on The Nasdaq Stock Market and
shall take such other action it deems appropriate under the Act and any
applicable state securities laws to claim an exemption from the registration
requirements thereof for the issuance of the Shares hereunder.
(f) Upon receiving any notice or information from the Company
hereunder respecting any contemplated or pending underwritten public offering of
Common Stock or of any circumstances, pending transactions or other matters
which may cause the Registration Statement as then in effect to contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances in which they were made, then until advised by the
Company, the Purchaser shall strictly maintain the confidentiality of such
information and shall make no public disclosures or comments with respect
thereto, and shall not otherwise trade in any securities of the Company until
such offering is effected or information is otherwise publicly disclosed by the
Company.
(g) The Company will bear all reasonable and customary expenses
arising or incurred by it in connection with any registration under the Act of
the Shares hereunder, including without limitation, registration fees, printing
expenses and the Company's accounting and legal fees and expenses; provided that
the Purchaser will bear the expense of any underwriting or brokerage fees,
discounts or commissions applicable to its sale of the Shares and the fees and
expenses of any separate legal counsel or accounting firm engaged by the
Purchaser.
(h) The Company agrees to indemnify and hold harmless the Purchaser,
each person, if any, who controls the Purchaser within the meaning of Section 15
of the Act and each officer, director, employee and agent of the Purchaser and
of any such controlling person against any and all liabilities, claims, damages
or expenses and will reimburse the Purchaser for its reasonable legal and other
expenses (including the reasonable cost of any investigation and preparation,
and including the reasonable fees and expenses of counsel) incurred, arising out
of (i) a misstatement of a material fact or omission to state a material fact
required to be stated in or necessary to make the statements therein not
misleading in light of the circumstances in which they were made in the
Registration Statement described in Section 3(a) above, or any final
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Prospectus contained in such Registration Statement, as supplemented or amended,
as the case may be, unless the Purchaser was notified by the Company to refrain
from selling any Shares pursuant to the Registration Statement as set forth in
Section 3(b) above; or (ii) the Registration Statement or Prospectus, as
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supplemented or amended, not being in compliance with the Federal and applicable
State securities laws, in all material respects. The Company agrees that if any
indemnification sought Pursuant to this Section 3(h) were for any reason not to
be available to the Purchaser or insufficient to hold it harmless as and to the
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extent contemplated by this Section, then the Company shall contribute to the
amount paid or payable by such Purchaser in respect of losses, claims, damages
and liabilites in such proportion as is appropriate to reflect the relative
faults of such parties as well as any other equitable considerations.
4. Representations and Warranties of the Company. The Company represents
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and warrants, as of the date hereof and as of the Closing Date, as follows:
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(a) no consent, approval, authorization or order of any court, governmental
agency or body or arbitrator having jurisdiction over the Company or any of the
Company's affiliates is required for the execution of this Agreement or the sale
of the Shares to the Purchaser;
(b) neither the sale of the Shares nor the performance of the Company's other
obligations pursuant to this Agreement will violate, conflict with, result in a
breach of, or constitute a default (or an event that, with the giving of notice
or the lapse of time or both, would constitute a default) under (i) the
Certificates of Incorporation or bylaws of the Company; (ii) any decree,
judgment, order or determination of any court, governmental agency or body, or
arbitrator having jurisdiction over the Company or any of the Company's
properties or assets; (iii) any law, treaty, rule or regulation applicable to
the Company (other than the federal securities laws, representations and
warranties with respect to which are made by the Company solely in paragraphs
(e) through (h) of this Section 4, or the requirements of the Nasdaq Stock
Market); or (iv) the terms of any bond, debenture, note or other evidence of
indebtedness, or any agreement, stock option or similar plan by which the
Company is bound or to which any property of the Company is subject, in any
event above, which violation, conflict or breach would have a material adverse
effect on the Company;
(c) the Company has taken all corporate action required to authorize the
execution and delivery of this Agreement and the performance of its obligations
hereunder;
(d) the Company has duly authorized the issuance of the Shares and, when
issued and delivered to and paid for by the Purchaser in accordance with the
terms hereof, the Shares will be duly and validly issued, fully paid and
nonassessable, and the issuance of such Shares to the Purchaser is not subject
to any preemptive or similar rights;
(e) based in substantial part on Purchaser's representations and warranties
below and the provisions in Paragraph 5, the sale of the Shares by the Company
to Purchaser hereunder is not part of a plan or scheme to evade the registration
requirements of the Act;
(f) neither the Company or, to its knowledge, any person acting on behalf of
the Company has offered or sold any of the Shares by any form of general
solicitation or general advertising;
(g) the Company has offered the Shares for sale only to "accredited
investors," as such term is defined in Rule 501(a) under the Act, who by reason
or their business and financial experience have such knowledge, sophistication
and experience in business and financial matters as to be capable of evaluating
the merits and risks of the investment in the Shares;
(h) the Company's Prospectus dated December 17, 1997, included in the
Company's Registration Statement on Form S-3 (Registration No. 333-33367); the
Company's Annual Report on Form 10-KSB (as amended) for its Fiscal Year Ended
June 30, 1997; the Company's proxy statement dated January 20, 1998 for its
Annual Meeting held on February 23, 1998; the Company's Quarterly Reports on
Form 10-Q for the fiscal quarters ended September 30, 1997 (as amended) and
December 31, 1997 (as amended); the Company's Current Reports on Form 8-K for
October 00,
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0000 (xx xxxxxxx), Xxx 00, 0000 (xx amended), August 22, 1997 (as amended),
October 22, 1997, December 1, 1997, January 6, 1998 (as amended), January 9,
1998 (as amended) and January 26, 1998; the Confidential Private Placement
Memorandum, as supplemented; and the risk factor disclosure attached hereto as
Exhibit A (collectively, the "Disclosure Documents") have been delivered to
Purchaser and, as of the date of each such respective document included therein
and when considered together and with this Agreement (and any similar agreements
being executed by the Company), such Disclosure Documents do not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances in which they were made with respect to the Company;
(i) the Company's Financial Statements for the year ended June 30, 1997
included in the Disclosure Documents comply in all material respects with the
applicable requirements of the Securities Exchange Act of 1934, as amended, and
have been prepared, and fairly present in all material respects the consolidated
financial condition, results of operations and cash flows of the Company and its
subsidiaries at the respective dates and for the respective periods indicated,
in accordance with generally accepted accounting principles consistently applied
throughout such periods (except as noted therein);
(j) except as set forth in the Disclosure Documents or pursuant to this
Agreement (or any similar agreements being executed by the Company) since
December 31, 1997 (i) the Company has not incurred any material liabilities,
direct or contingent except in the ordinary course of business other than
those incurred in the ordinary course of business, including, but not limited
to, additional borrowings under the revolving lines of credit of the Company and
its subsidiaries, those in connection with the acquisitions consummated by the
Company since December 31, 1997, and borrowings under a $10 million loan
obtained from Bank of America, and (ii) there has been no material adverse
change in the properties, business, results of operations or financial condition
of the Company; and
(k) as of February 23, 1998 (and without giving effect to the sale of Shares
hereunder or the contemporaneous sale of Common Stock to other institutional
accredited investors pursuant to similar agreements), the Company had a total of
31,208,738 shares of Common Stock issued and outstanding; approximately
6,255,000 shares of Common Stock were reserved for issuance pursuant to existing
stock options under the Company's current stock option plans or outside of the
plans and an additional 2,076,850 shares were issuable upon exercise of options
available for future grant; 400,000 shares of Common Stock were reserved for
issuance upon grant of Shares under the Bonus Plan, and 305,201 shares were
reserved for issuance pursuant to exercise of outstanding Preferred Stock.
5. Representations and Warranties of the Purchaser. The Purchaser
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represents and warrants that:
(a) the purchase of the Shares by the Purchaser is not part of a plan
or scheme to evade the registration requirements of the Act;
(b) the Purchaser is an "accredited investor," as such term is defined
in Rule 501(a) under the Act, who by reason of its business and financial
experience has such knowledge, sophistication and experience in business and
financial matters as to be fully capable of evaluating the merits and risks of
an investment in the Shares and, having had access to or having been
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furnished prior to the Closing Date with all such information as it has
considered necessary (including, without limitation, the Disclosure Documents),
has concluded that it fully understands and is able to bear to those risks;
(c) the Purchaser is purchasing the Shares for its own account or an
account with respect to which it exercises sole investment discretion and that
it and any such account is a "qualified institutional buyer" (as defined in Rule
144A promulgated under the Securities Act ("QIB") although the sale of the
Shares is not being made pursuant to Rule 144A, or an institutional accredited
investor (as defined in Rule 501 of Regulation D under the Securities Act);
(d) the Purchaser understands that the Shares constitute "restricted
securities" within the meaning of Rule 144 under the Act and may not be sold,
pledged or otherwise disposed of unless they are subsequently registered under
the Act and applicable state securities laws or unless an exemption from
registration thereunder is available and that a restrictive transfer legend will
be placed on the certificates for the Shares and stop transfer orders with
respect thereto will be provided to the Company's transfer agent for the
Company's Common Stock with substantially the following legend:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE
OFFERED OR SOLD UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT OR ANY
APPLICABLE STATE SECURITIES LAWS, OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE ACT OR ANY APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE.
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(e) in making any subsequent offering or sales of the Shares, the
Purchaser will be acting only for itself and not as part of a sale or planned
distribution in violation of the Act or any applicable state securities laws;
(f) the Shares were not offered to the Purchaser by any form of
general solicitation or general advertising;
(g) the Purchaser understands that no federal or state or other
governmental agency has passed upon or made any recommendation or endorsement
with respect to the Shares;
(h) the Purchaser is purchasing the Shares not with a view to, or for
sale in connection with, any distribution of the Shares in violation of the Act
or any applicable state securities laws;
(i) the Purchaser shall not resell or otherwise transfer such Shares
within two years after the original issuance of the Shares except (i) to the
Company or any subsidiary thereof, (ii) pursuant to the exemption from
registration provided by Rule 144 promulgated under the Securities Act (if
available), or (iii) pursuant to an effective registration statement under the
Securities Act;
(j) no consent, approval, authorization or order of any court,
government agency or body or arbitrator having jurisdiction over the Purchaser
or any of the Purchaser's affiliates is required for the execution of this
Agreement, or the performance of the Purchaser's obligations hereunder,
including, without limitation, the purchase of the Shares by the purchaser;
(k) the Purchaser has or, prior to the Closing Date, will have taken
all corporate action required to authorize the execution and delivery of this
Agreement and the performance of its obligation hereunder; and
(l) the Purchaser acknowledges that it is fully aware and understands
completely the business of the Company and its financial condition, and has
received each of the documents included in the Disclosure Documents. The
Company intends to use the net proceeds of this offering, primarily for the
pending acquisition of a company and the balance for working capital.
6. Conditions of Closing. The obligations of each party hereunder shall
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be subject to (a) the accuracy in all material respects of the representations
and warranties of the other party hereto as of the date hereof and as of the
Closing Date, as if such representations and warranties had been made again on
and as of the Closing Date and (b) the performance in all material respects by
the other party of its obligations hereunder which must be performed prior to
the Closing Date.
7. Indemnification.
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(a) The Company agrees to indemnify and hold harmless the Purchaser, each
person, if any, who controls the Purchaser within the meaning of Section 15 of
the Act and each officer,
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director, employee and agent of the Purchaser and of any such controlling person
against any and all liabilities, claims, damages or expenses whatsoever, as
incurred arising out of any representation, warranty, covenant or undertaking by
the Company contained in this Agreement, and the Company will reimburse the
Purchaser for its reasonable legal and other expenses (including the reasonable
cost of any investigation and preparation, and including the reasonable fees and
expenses of counsel) incurred in connection therewith.
(b) The Purchaser agrees to indemnify and hold harmless the Company, each
person, if any, who controls the Company within the meaning of Section 15 of the
Act and each officer, director, employee and agent of the Company and of any
such controlling person against any and all losses, liabilities, claims, damages
or expenses whatsoever, as incurred arising out of or resulting from any breach
or alleged breach or other violation or alleged violation of any representation,
warranty, covenant or undertaking by the Purchaser contained in this Agreement,
and the Purchaser will reimburse the Company for its reasonable legal and other
expenses (including the reasonable cost of any investigation and preparation,
and including the reasonable fees and expenses of counsel) incurred in
connection therewith.
8. Survival of Representations and Warranties. The respective
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agreements, representations, warranties, indemnities and other statements made
by or on behalf of each party hereto pursuant to this Agreement, as of the date
they were made, shall survive until the termination of the Registration Period.
9. Miscellaneous.
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(a) This. Agreement may he executed in one or more counterparts and
such counterparts shall constitute but one and the same agreement and
authorized signatures may be evidenced to the other party by facsimile copies
thereof; provided that the originally signed signature page of any party is
provided to the other party within two business days after original execution.
(b) This Agreement shall inure to the benefit of and be binding upon
the parties hereto. This Agreement shall not be assignable by any party hereto
without the prior written consent of the other party hereto and no other person
shall have any right or obligation hereunder. Without limiting the foregoing,
the rights of Purchaser set forth in Paragraph 2 shall not be transferable to
subsequent purchasers of the Shares. Any assignment contrary to the terms
hereof shall be null and void and of no force or effect.
(c) This Agreement obtains the entire agreement between the parties
with respect to the subject matter hereof and supersedes any prior agreements or
understandings, whether written or oral, between the parties respecting such
subject matter.
10. Governing Law.
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This Agreement shall be governed by the internal laws of the State of
Nevada.
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IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
date first set forth above.
("Company")
By:______________________________________
______________________________________
("Purchaser")
By:______________________________________
Name:____________________________________
Title:_____________________________________
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