STOCK PURCHASE AND SUBSCRIPTION AGREEMENT
DATED AS OF JANUARY _____, 2000
AMONG
PR PHARMACEUTICALS, INC.
▇▇▇▇▇ ▇. ▇▇▇▇, M.D.
AND
▇▇▇▇▇▇▇ ▇. ▇▇▇▇,
RAINCREST ASSOCIATES, LLC
▇▇▇▇▇ ▇. ▇▇▇▇▇,
BIRKLEA, LTD.
AND
▇▇▇▇ ▇▇▇▇▇
STOCK PURCHASE AND SUBSCRIPTION AGREEMENT
AGREEMENT (the "Agreement") dated January __, 2000 ("Agreement") among PR
PHARMACEUTICALS, INC., a Colorado corporation ("PRP"), ▇▇▇▇▇ ▇. ▇▇▇▇, M.D. and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ (husband and wife), RAINCREST ASSOCIATES, LLC, a Colorado
limited liability company, BIRKLEA, LTD., and ▇▇▇▇ ▇▇▇▇▇, (collectively the
"Shareholders"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇").
RECITALS
A. Collectively, the Shareholders own or control, directly or indirectly,
1,345,517 shares of the issued and outstanding common stock of VEREX
LABORATORIES, INC. ("Verex"), which shares collectively constitute a minimum of
52.95 % of all of the issued and outstanding shares of the capital stock of
Verex, on a fully diluted basis (the "Shares").
▇. ▇▇▇▇▇ is an officer and director of Verex, and owns certain options to
acquire Shares of Verex common stock.
C. PRP desires to purchase from the Shareholders, the Shareholders desire
to sell to PRP the Shares on the terms and conditions set forth on this
Agreement, and the parties hereto desire to enter into employment, warrant and
option agreements with respect to their affiliation with Verex and employment
with PRP, all on the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and of the
mutual covenants set forth herein, the parties agree as follows:
SECTION 1
PURCHASE OF STOCK
1.1 PURCHASE OF STOCK. Each of the Shareholders hereby sells, conveys,
transfers, and assigns to PRP, free and clear of all liens, pledges, claims, and
encumbrances of every kind, nature, and description, and PRP hereby purchases
and accepts from the Shareholders, all of the Shares, subject to the terms and
conditions set forth herein.
SECTION 2
PURCHASE PRICE
2.1 PURCHASE PRICE. The purchase price for the Shares shall be the issuance
by PRP of one share of the issued and outstanding common stock of PRP for each
15 Shares (the "Stock Payment"). No fractional shares of PRP common stock shall
be issued; instead, any fraction shall be rounded up or down to the nearest
whole number of shares of PRP common stock.
2.2 DELIVERY OF SHARES AND STOCK PAYMENT. Contemporaneously with the
execution and delivery of this Agreement, and as a condition precedent to PRP's
obligations hereunder, the Shareholders shall have, either directly, or through
an independent third party agent, delivered to PRP certificates representing
collectively, all of the Shares, each of which certificates shall be duly
endorsed as transferred to PRP, or with duly endorsed stock powers attached to
the stock certificates representing the Shares. Contemporaneously with the
execution and delivery of this Agreement, and subject to the condition that PRP
has received certificates representing all of the Shares, PRP shall issue and
deliver to each of the Shareholders the Stock Payment, in the amounts as set
forth on Exhibit A hereto.
SECTION 3
REPRESENTATIONS AND WARRANTIES
3.1 GENERAL STATEMENT. The parties make the representations and warranties
to each other which are set forth in this Section III. All such representations
and warranties and all representations and warranties that are set forth
elsewhere in this Agreement and in any financial statement, exhibit, schedule or
document delivered by or on behalf of a party hereto or their representative to
the other party pursuant to this Agreement shall survive the consummation of the
transactions contemplated hereby (and none shall merge into any instrument or
conveyance), regardless of any knowledge or belief, investigation or lack of
investigation by the parties to this Agreement.
3.2 REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS. Each of the
Shareholders and ▇▇▇▇▇ understands that PRP is relying upon the following
representations and warranties in making its decision to purchase the Shares and
enter into this Agreement. Each of the Shareholders and ▇▇▇▇▇ jointly and
severally make the following representations and warranties to PRP.
(a) DUE INCORPORATION, GOOD STANDING, AND QUALIFICATION. Verex is a
corporation duly organized, validly existing, and in good standing under the
laws of the jurisdiction of its incorporation with all requisite corporate power
and authority to own, operate, and lease its assets and properties and to carry
on its business as now being conducted. Verex is not subject to any material
disability by reason of the failure to be duly qualified as a foreign
corporation for the transaction of business or to be in good standing under the
laws of any jurisdiction.
(b) CAPITAL STOCK. As of the date hereof, Verex has an authorized capital
stock consisting of 100,000,000 shares of Common Stock, no par value per share,
of which no more than 2,540,987 shares are issued and outstanding. All of the
issued and outstanding shares of capital stock of Verex have been duly
authorized and validly issued and are fully paid and nonassessable. There are no
other authorized or issued or outstanding shares of Verex of any class, kind or
character. Each of the Shareholders owns that number of Verex shares of common
stock as is set forth on Exhibit A. Exhibit B sets forth a true and correct list
of the name and current address of each holder of record of Verex capital stock
and the number of shares held by each.
(c) OWNERSHIP OF STOCK. Each of the Shareholders has good and marketable
title to, and rightful possession of, all of the Shares as set forth on Exhibit
A. Except as set forth on Exhibit A or C, no Shareholder or ▇▇▇▇▇ has any right,
title or interest in any capital stock of Verex, or any right to obtain any such
capital stock.
Page 2
(d) OPTIONS, WARRANTS, AND RIGHTS. Verex has outstanding the options,
warrants, or other rights to purchase, or securities or other obligations
convertible into or exchangeable for, or contracts, commitments, agreements,
arrangements, or understandings, to issue, any shares of its capital stock or
other securities in such amounts and for the benefit of such persons or entities
as is set forth on Exhibit C. There are no other outstanding obligations of
Verex, contractual or otherwise, to repurchase, redeem or otherwise acquire any
outstanding shares of its capital stock.
(e) POWER TO EXECUTE AGREEMENT. Each of the Shareholders and ▇▇▇▇▇ has the
full power and authority to execute, deliver, and perform its obligations under
this Agreement, and this Agreement is the legal and binding obligation of each
of the Shareholders and ▇▇▇▇▇ and is enforceable against each of the
Shareholders and ▇▇▇▇▇ in accordance with its terms, except that (i) such
enforcement may be subject to bankruptcy, insolvency, reorganization,
moratorium, or other similar laws now or hereafter in effect relating to
creditors' rights, and (ii) the remedies of specific performance and injunctive
and other forms of equitable relief may be subject to equitable defenses and to
the discretion of the court before which any proceeding therefore may be
brought.
(f) NO SUBSIDIARIES. Verex does not own, directly or indirectly, any
capital stock or other equity securities of any corporation or have any direct
or indirect equity or ownership interest in any corporation or other business or
entity. Prior to the date hereof, Verex did have some subsidiaries. Each of the
Shareholders will indemnify and hold PRP and Verex harmless with respect to any
actual losses, costs, expenses, claims or damages, incurred by PRP and/or Verex
arising out of or as a result of any of such former subsidiaries.
(g) BOOKS AND RECORDS; FILINGS. The books of account and other corporate
records of Verex are complete and accurate in all material respects and have
been maintained in accordance with generally accepted accounting principles, and
the matters contained therein are appropriately reflected in Verex's financial
statements filed with the Securities and Exchange Commission ("SEC") or
delivered to PRP. The minute books and stock records of Verex are complete and
accurate in all material respects, and all signatures included therein are the
genuine signatures of the persons whose signatures are required. Verex has
delivered to PRP true and complete copies of its articles and bylaws as
currently in effect. All reports and proxy statements filed by Verex with the
SEC are true and correct in all material respects, and do not contain any
misstatements of any material facts or omit to state any material facts required
to be stated therein.
(h) ASSETS.
(i) Verex has good and marketable title to and rightful possession of
all of its assets, free and clear of any and all mortgages, liens, pledges,
privileges, claims, rights, charges, encumbrances and security interests of
whatsoever kind or nature, except for liens or liabilities disclosed in Exhibit
D hereto.
(ii) The furniture, fixtures and equipment of Verex reflected in
Exhibit E are in good working condition and repair, subject to normal wear and
tear.
Page 3
(iii) ABILITY TO CONDUCT BUSINESS. The assets of Verex constitute all
of the assets and properties that are necessary to permit Verex to continue to
conduct the business of Verex after the signing hereof, in the same manner in
which it is presently being conducted.
(i) REAL PROPERTY; LEASES. A true, complete and correct list of all real
property of every kind, and all interests in real property, that are owned,
leased, occupied or used by Verex is disclosed in Exhibit F hereto.
(j) FINANCIAL STATEMENTS.
(i) The shareholders have previously furnished PRP with true,
complete, and correct copies of the [unaudited] financial statements of Verex as
of and for the period ended December 31, 1999 (the "Financial Statements"). The
Financial Statements have been prepared on an accrual basis from the books and
records of Verex and in accordance with generally accepted accounting
principles.
(ii) Verex has no liabilities or obligations, fixed or contingent,
accrued or unaccrued that are not reflected, adequately reserved against or
otherwise disclosed on the December 31, 1999 Balance Sheet and on Exhibit D,
between the date of the December 31, 1999 Balance Sheet and the signing of this
Agreement, none of which liabilities is individually or collectively material,
incurred in violation of this Agreement, or would require accrual and/or
disclosure under generally acceptable accounting principles.
(k) LIABILITIES. Except as either fully disclosed in Exhibit D hereto, or
fully and properly reflected on or reserved for in the December 31, 1999 Balance
Sheet none of which would require accrual or disclosure under generally accepted
accounting principles, Verex has no: (i) debts, liabilities or obligations of a
nature required to be reflected or disclosed in financial statements prepared in
accordance with generally accepted accounting principles; or (ii) other debts,
liabilities or obligations, whether accrued, absolute, contingent or otherwise,
whether due or to become due, relating to or arising out of any act,
transaction, circumstance or state of facts that occurred or existed or before
December 31, 1999. Since such date, Verex has incurred no debts, liabilities or
obligations, whether accrued, absolute, contingent or otherwise, whether due or
to become due, other than debts, liabilities and obligations incurred in the
ordinary course of business of Verex, none of which are either individually or
collectively material or incurred in violation of this Agreement and none of
which would require accrual or disclosure under generally accepted accounting
principles.
(l) LITIGATION. There are no actions, suits, proceedings, pending or
threatened against Verex, or to the knowledge of the Shareholders or ▇▇▇▇▇,
against any officer or director of Verex in connection with their activities on
behalf of or in the name of Verex, at law or in equity, or before or by any
federal, state, municipal, or other governmental department, commission, board,
bureau, agency, or instrumentality.
(m) TECHNOLOGY, RIGHTS AND LICENSES. Verex is not subject to any material
disability or liability by reason of its failure to possess any patent, patent
right, trademark, copyright, trademark right, trade name, trade name right, or
license. Verex has, or has applied for, all patents, trademarks, trade names,
copyrights, licenses, permits, approvals, and authorizations of whatever kind
Page 4
and type (the "Rights"), governmental or private, necessary for the conduct of
the business conducted by it and the ownership and use of its assets and
properties and the premises occupied by it, and the conduct of its business as
presently conducted. Attached as Exhibit G is a true and correct list of the
status of all licenses, patents, trademarks, trade names and copyrights applied
for, granted, issued, or in process, or received, by Verex as of the date
hereof. To the best knowledge of the Shareholders and ▇▇▇▇▇, after due inquiry
and investigation, none of the matters covered thereby, nor any of the products
or services sold or provided by Verex, nor any of the processes used or the
business practices followed by Verex infringes or has infringed upon any
trademark, trade name, fictitious name, service ▇▇▇▇, patent or copyright owned
by any person or entity (or any application with respect thereto), or
constitutes unfair competition. Other than as set forth on Exhibit G, Verex is
not obligated to pay any royalty or other payment with respect to any of the
Rights. To the best knowledge of the Shareholders and ▇▇▇▇▇, after due inquiry
and investigation, no person or entity is producing, providing, selling or using
products or services which would constitute an infringement of any of the
Rights.
(n) TAXES. Verex has duly filed in correct form all Tax Returns relating to
the activities of Verex required or due to be filed (with regard to applicable
extensions) on or prior to the date hereof. All such Tax Returns are complete
and accurate in all material respects, and Verex has paid or made provision for
the payment of all Taxes that have been incurred or are due or claimed to be due
from Verex by federal, state, or local taxing authorities for all periods ending
on or before the date hereof, other than Taxes or other charges that are not
delinquent or are being contested in good faith. No claims for Taxes or
assessments are being asserted or, to the knowledge of Verex and its officers
and employees with responsibilities for such matters, threatened against Verex.
For purposes of this Agreement, the term "Taxes" shall mean all taxes, charges,
fees, levies, or other assessments, including, without limitation, income, gross
receipts, excise, property, sales, transfer, license, payroll, and franchise
taxes, imposed by the United States, or any state, local, or foreign government
or subdivision or agency thereof; and such term shall include any interest,
penalties, or additions to tax attributable to such assessments or to the
failure to file any tax return; and the term "Tax Return" shall mean any report,
return, or other information required to be supplied to a taxing authority or
required by a taxing authority to be supplied to any other person.
(o) COMPLIANCE WITH LAW AND OTHER REGULATIONS. To the best knowledge of the
Shareholders and ▇▇▇▇▇, Verex is in compliance in all material respects with all
requirements (including those relating to securities and environmental matters)
of federal, state, or local law and all requirements of all governmental bodies
and agencies having jurisdiction over it, the conduct of its business, the use
of its assets and properties, and all premises occupied by it. There is no
environmental contamination, toxic waste, or other discharge, spill,
construction component, structural element or condition, adversely affecting any
of the properties of Verex, nor has Verex received any official notice or
citation that any of its properties or leased premises in any material way
contravene any federal, state, or local law or regulation relating to
environmental, health, or safety matters, including, without limitation, any
requirements of the Comprehensive Environmental Response Compensation and
Liability Act ("CERCLA") or OSHA requirements. Without limiting the foregoing,
Verex has properly filed all reports, paid all monies, and obtained all
licenses, permits, certificates, and authorizations needed or required for the
conduct of its business and the use of its assets and properties and the
Page 5
premises occupied by it in connection therewith and is in compliance in all
material respects with all conditions, restrictions, and provisions of all of
the foregoing. Verex has not received any notice from any federal, state, or
local authority or any insurance or inspection body that any of its assets,
properties, facilities, equipment, or business procedures or practices fails to
comply with any applicable law, ordinance, regulation, building, zoning law, or
requirement of any public authority or body.
(p) CONTRACTS. Exhibit H hereto sets forth a complete list of all of the
leases and business contracts to which Verex is a party, specifying the name of
the customer, supplier or other party thereto, the amount involved, the subject
matter and other material information. Except as set forth in Exhibit H, each
business contract is in full force and effect and is binding upon Verex and, to
the best knowledge and belief of the Shareholders and ▇▇▇▇▇, upon the other
parties thereto; no material default by any party thereto exists; no event,
occurrence or condition exists which, with the lapse of time, the giving of
notice, or both, or the happening of any further event or condition, would
become a material default thereunder; and Verex has not waived or released any
of its rights under any of such contracts.
(q) EMPLOYEE BENEFIT AND EMPLOYMENT MATTERS. To the best knowledge of the
Shareholders and ▇▇▇▇▇, Verex has fulfilled its obligations, if any, under the
minimum funding standards of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee
Retirement Income Security Act of 1974 ("ERISA") and the regulations and
published interpretations thereunder with respect to each "plan" (as defined in
Section 3(3) of ERISA and such regulations and published interpretations) in
which employees of Verex are eligible to participate, and each such plan is in
compliance in all material respects with the presently applicable provisions of
ERISA and such regulations and published interpretations. Verex has not incurred
any unpaid liability to the Pension Benefit Guaranty Corporation (other than for
the payment of premiums in the ordinary course) or to any such plan under Title
IV of ERISA. The employment of each of the employees of Verex is terminable at
will without cost to Verex. Verex has complied in all material respects with all
other applicable federal, state, and local laws relating to the employment of
labor, including, without limitation, the provisions thereof relative to wages,
hours, collective bargaining, working conditions, and payment of taxes of any
kind, and Verex is not liable for any arrears of wages or any taxes or penalties
for failure to comply with any of the foregoing and does not have any
obligations for any vacation, sick leave, or other compensatory time, except as
set forth on Exhibit I hereto.
(r) INSURANCE. Verex maintains in full force and effect insurance coverage
on its assets, properties, premises, operations, and personnel in such amounts
as Verex deems appropriate. Verex has been continuously, and is presently,
insured by insurers unaffiliated with Verex with respect to its property and the
conduct of its business in such amounts and against such risks as Verex has
reasonably deemed adequate to protect its business and assets, including,
without limitation, general comprehensive liability insurance.
(s) RENEGOTIATION. Verex is not subject to any legal obligations to
renegotiate, nor does any Shareholder or ▇▇▇▇▇ have any knowledge or reason to
believe that there exists any claim or legal right to renegotiate, any contract,
loan, agreement, lease, sublease or instrument to which Verex is now or has been
bound.
Page 6
(t) AGREEMENT NOT IN BREACH OF OTHER INSTRUMENTS. The execution and
delivery of this Agreement, the consummation of the transactions contemplated
hereby, and the fulfillment of the terms hereof by the Shareholders and ▇▇▇▇▇,
will not violate any provision of the articles of incorporation or bylaws of
Verex, nor will they result in the breach of any term or provision of, or result
in the termination or modification of, or constitute a default under, or permit
any party to modify or terminate, any loan agreement, note, debenture,
indenture, mortgage, deed of trust, lease, contract, agreement, or other
material obligation of any description to which Verex or a Shareholder or ▇▇▇▇▇
is a party or by which either is bound, or any judgment, decree, order, or award
of any court, government body, or arbitration, or any applicable law, rule, or
regulation.
(u) ACCURACY OF STATEMENTS. This Agreement does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements contained herein or therein, in light of circumstances in which
they are made, not misleading.
3.3 REPRESENTATIONS AND WARRANTIES OF PRP. PRP represents and warrants to
the Shareholders and ▇▇▇▇▇ as follows:
(a DUE INCORPORATION, GOOD STANDING, AND QUALIFICATION. PRP is a
corporation duly organized, validly existing, and in good standing under the
laws of its jurisdiction of incorporation with all requisite corporate power and
authority to own, operate, and lease its assets and properties and to carry on
its business as now being conducted. PRP is not subject to any material
disability by reason of the failure to be duly qualified as a foreign
corporation for the transaction of business or to be in good standing under the
laws of any jurisdiction.
(b) CORPORATE AUTHORITY. PRP has the corporate power and authority to enter
into this Agreement and carry out the transactions contemplated hereby. This
Agreement has been duly executed and delivered by, and constitutes a legal,
valid, and binding agreement of PRP, enforceable against it in accordance with
its terms, except that (i) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium, or other singular laws now or hereafter
in effect relating to creditors' rights, and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefore may be brought.
(c) NO VIOLATION. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by PRP, and the fulfillment
of the terms hereof by PRP, will not violate any provision of the articles of
incorporation or bylaws of PRP, nor will they result in the breach of any term
or provision of, or result in the termination or modification of, or constitute
a default under, or permit any party to modify or terminate, any loan agreement,
note, debenture, indenture, mortgage, deed of trust, lease, contract, agreement,
or other material obligation of any description to which PRP is a party or by
which PRP is bound, or any judgment, decree, order, or award of any court,
government body, or arbitration, or any applicable law, rule, or regulation.
Page 7
(d) ACCURACY OF STATEMENTS. This Agreement does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements contained herein or therein, in light of circumstances in which
they are made, not misleading.
3.4 REPRESENTATIONS AND WARRANTIES OF PRP AND SHAREHOLDERS. To induce PRP
to issue the Stock Payment, and to induce the Shareholders to deliver the
Shares, each party warrants and represents with respect to itself that:
(a) It has the ability to bear the economic risk of the Shares or Stock
Payment, as applicable, including the complete loss of its investment.
(b) It has sufficient knowledge and experience in business and financial
matters (or has received from a person of its selection sufficient advice with
respect to such matters) to be capable of evaluating the merits and risks of the
Shares or Stock Payment, as applicable.
(c) Each party has knowledge of, and has been provided the opportunity to
acquire information with respect to, the proposed business affairs, financial
condition, plans and prospects of the other parties which it deems relevant in
making a fully informed decision with respect to the Shares or Stock Payment, as
applicable.
(d) Each party has its own legal counsel and has been encouraged and has
had the opportunity to rely upon the advice of its legal counsel and other
advisers with respect to the Shares or Stock Payment, as applicable.
(e) Each party has had the opportunity to ask questions and receive
information with respect to, among other things, the proposed business affairs,
financial condition, plans and prospects of the other party and the terms and
conditions of the issuance of the Shares or Stock Payment, as applicable.
(f) No party nor any person representing or acting on behalf of any party,
or purportedly representing or acting on behalf of any party, has made any
representations, warranties, agreements or statements other than those contained
herein which influenced or affected that party's decision to accept the issuance
of the Shares or Stock Payment, as applicable.
(g) Each party is acquiring the Shares or Stock Payment, as applicable, for
its own account without any view to the transfer, sale, assignment or other
distribution thereof.
Each Shareholder and ▇▇▇▇▇ further acknowledges, understands and agrees
that shares of PRP common stock to be issued hereunder have not been and will
not be registered under any federal or state securities law, including, but not
limited to, the Securities Act of 1933, as amended, or any State Securities Act,
and that no federal or state governmental agency or authority has approved or
passed upon the issuance of the shares of PRP common stock to be issued
hereunder. Each party understands that there is not now, and that there is not
likely to be in the future, any market for the shares of PRP common stock to be
issued hereunder and that the shares of PRP common stock to be issued hereunder
must be held by it for an indefinite period of time, absent registration or
qualification of the shares of PRP common stock to be issued hereunder under
Page 8
applicable laws or the receipt of an opinion of counsel satisfactory to PRP that
registration or qualification is not required. Each party acknowledges that the
certificate representing the shares of PRP common stock to be issued hereunder
will bear a legend substantially in the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER FEDERAL OR STATE SECURITIES LAWS.
THE SHARES MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, OR
OTHERWISE DISPOSED OF UNLESS SO REGISTERED OR QUALIFIED, UNLESS
AN EXEMPTION EXISTS OR UNLESS SUCH DISPOSITION IS NOT SUBJECT TO
THE FEDERAL OR STATE SECURITIES LAWS, AND THE AVAILABILITY OF ANY
EXEMPTION OR THE INAPPLICABILITY OF SUCH SECURITIES LAWS MUST BE
ESTABLISHED BY AN OPINION OF COUNSEL, WHICH OPINION OF COUNSEL
WILL BE REASONABLY SATISFACTORY TO THE COMPANY."
(h) PRP TRANSFER RESTRICTION. Each Shareholder and ▇▇▇▇▇ further
acknowledges, understands and agrees that the shares of PRP common stock to be
issued hereunder will be subject to the transfer restrictions in PRP's articles
of incorporation, including a right of first refusal of PRP, and the
certificates evidencing such shares will bear a legend to this effect.
(i) REGISTRATION RIGHTS. Each of ▇▇▇▇▇ and the Shareholders shall have
piggyback registration rights with respect to the PRP shares of common stock
representing the Stock Payment and any shares of PRP common stock issued to them
pursuant to the warrants described in Section 6.3 (as such numbers of shares may
be adjusted due to stock splits, reverse splits, stock reorganizations and
mergers of PRP) (the "Registration Eligible Shares") as follows. If at any time,
or from time to time, after the initial public offering of shares of PRP capital
stock, which offering is in an amount of $50 million or more, PRP proposes to
register any of its securities under the Securities Act of 1933, as amended (the
"Securities Act"), (other than in connection with a transaction contemplated by
Rule 145(a) promulgated under the Securities Act or pursuant to Form ▇-▇, ▇▇▇▇
▇-▇ or any successor form thereto), and other holders of at least five percent
(5%) of the then issued and outstanding capital stock of PRP are participating
in such offering selling shareholders, PRP shall give written notice by
registered or certified mail at least thirty (30) days prior to the filing of
such registration statement, to ▇▇▇▇▇ and the Shareholders of its intention to
file a registration. If any of ▇▇▇▇▇ or the Shareholders notify PRP in writing
not more than twenty (20) days after receipt of such notice of their desire to
include any such Registration Eligible Shares in such proposed registration
statement, PRP shall (subject to the limitations described below) afford such
holders of the Registration Eligible Shares the opportunity to have any such
Registration Eligible Shares registered under such registration statement, on
the same terms as the other shareholders participating in the offering.
Notwithstanding the foregoing, PRP shall have the right at any time after it
shall have given written notice of such proposed registration (irrespective of
whether a written request for inclusion of any such Registration Eligible Shares
shall have been made) to elect not to file any such proposed registration
Page 9
statement, or to withdraw the same after the filing but prior to the effective
date thereof. These registration rights expire, with respect to the Stock
Payment, two years after the date hereof, and with respect to any other
Registration Eligible Shares, on such date or dates as the volume limitations
imposed by Rule 144, or the then equivalent thereto, no longer apply.
Notwithstanding the foregoing, if the managing underwriter of any such
registered offering advises PRP in writing that the number of securities such
holders of Registration Eligible Shares, PRP and any other persons or entities
having registration rights (regardless of whether such registration rights were
granted on, prior to or subsequent to the date hereof) intend to include in such
offering should, in the managing underwriter's sole discretion, be limited, then
the amount of securities to be offered for the account of holders of
Registration Eligible Shares, along with the securities of any other persons or
entities having registration rights (regardless of whether such registration
rights were granted on, prior to or subsequent to the date hereof), but
excluding securities that PRP intends to include in such offering, shall be
reduced PRO RATA to the extent necessary to reduce the aggregate amount of
securities proposed to be registered to the aggregate amount recommended by the
managing underwriter.
Each of ▇▇▇▇▇ and the Shareholders agrees, if requested by the managing
underwriter in an underwritten offering, not to effect any public sale or
distribution of securities of the same class as the securities included in such
registration statement, including a sale pursuant to Rule 144 under the
Securities Act of 1933, as amended (except as part of such underwritten
registration), during the 10-day period prior to, and during the 180-day period
beginning on the closing date of each underwritten offering made pursuant to
such registration statement.
With respect to any registration pursuant to this section, PRP shall pay
all registration expenses in connection with the any such registration but
excluding underwriting discounts and commissions, if any, relating to the sale
or disposition of Registration Eligible Shares by holders thereof, any transfer
tax payable with respect thereto and the fees and expenses of any holder's
counsel. PRP shall agree to indemnify the holders of Registration Eligible
Shares which are included in a registration statement pursuant hereto
substantially to the same extent as PRP agrees to indemnify the underwriters in
the underwriting agreement, and the holders of Registration Eligible Shares
participating in such offering shall agree to indemnify PRP and any underwriter
with respect to information furnished by them for inclusion therein
substantially to the same extent as the underwriters have indemnified PRP in the
underwriting agreement. PRP may require each holder of Registration Eligible
Shares, as a condition to registration, to furnish PRP such information
regarding such seller and the distribution of such securities as may be required
to be included in any registration statement or amendment thereto that PRP may
request in writing. Each holder of Registration Eligible Shares participating in
any such piggyback registration shall agree to be bound by the terms of any
lock-up arrangements or other covenants requested by the managing underwriter in
any such registration and to complete and execute all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents, instruments
and agreements required under the terms of such underwriting arrangements or
otherwise reasonably requested by the PRP or the underwriter in connection
therewith.
Page 10
SECTION 4
DELIVERIES
4.1 DELIVERIES BY PRP. Contemporaneously with the execution and delivery of
this Agreement, PRP shall deliver:
(a) STOCK CERTIFICATES. Certificates representing the Stock Payment, issued
to the Shareholders in such numbers as set forth on Exhibit A.
(b) CONSENTS AND APPROVALS. Written evidence of all required consents and
approvals of the transactions contemplated hereby, including the written consent
or minutes of the Board of Directors of PRP.
4.2 DELIVERIES BY SHAREHOLDERS. Contemporaneously with the execution and
delivery of this Agreement, the Shareholders shall deliver to PRP:
(a) SHARES. Stock certificates representing all of the Shares as provided
in Section 2.2.
(b) PRESS RELEASE. A draft Press Release for PRP's approval, with respect
to the transactions contemplated hereby.
(c) CONSENTS AND APPROVALS. Written evidence of all required consents and
approvals of the transactions contemplated hereby.
(d) SHAREHOLDER RELEASES. A release signed by each of the Shareholders in
the form of Exhibit J.
(e) CERTIFICATE OF EXISTENCE. A certificate of existence of Verex, issued
not more than ten (10) days prior to the date hereof, by the Secretary of State
of Colorado.
(f) RESIGNATIONS. Resignations as officers and directors by each
Shareholder other than ▇▇. ▇▇▇▇ and ▇▇▇▇▇.
(g) INDEMNITY AGREEMENT. An agreement signed by ▇▇. ▇▇▇▇ and ▇▇▇▇▇
regarding the settlement between Verex and Medical Research Laboratories, Inc.
4.3 FURTHER ASSURANCES. The parties hereto shall execute and deliver all
such other instruments and take all such other action as any party may
reasonably request from time to time, before or after the date of this
Agreement, in order to effectuate the transactions provided for herein. The
parties shall cooperate with each other and with their respective counsel and
accountants in connection with any steps to be taken as a part of their
respective obligations under this Agreement, including the preparation of
financial statements.
Page 11
SECTION 5
RELEASES AND INDEMNIFICATION
5.1 RELEASES. Contemporaneous with the execution and delivery of this
Agreement, each of the Shareholders and ▇▇▇▇▇ shall have signed a Release in the
form attached as Exhibit J, except for accrued salaries, vacation pay as set
forth on Exhibit J, and except for notes payable to officers by Verex, as listed
on the Verex Balance Sheet dated December 31, 1999, as presented to PRP, each of
the Shareholders and ▇▇▇▇▇ releases Verex from and against any claims they may
have with respect to the Shares and Verex arising out of events or facts
existing prior to the date hereof.
5.2 INDEMNIFICATION OF SHAREHOLDERS AND ▇▇▇▇▇.
(a) Shareholders and ▇▇▇▇▇ covenant and agree to defend, indemnify and hold
PRP and it officers, directors, employees, shareholders and agents (collectively
the "PRP Parties") harmless for, from and against any and all damages, losses,
liabilities (absolute and contingent), fines, penalties, costs and expenses
(including, without limitation, reasonable counsel fees and costs and expenses
incurred in the investigation, defense or settlement of any claim covered by
this indemnity) with respect to or arising out of any demand, claim, inquiry,
investigation, proceeding, action or cause of action that any of the PRP parties
may suffer or incur by reason of: (i) the inaccuracy of any of the
representations or warranties of Shareholders or ▇▇▇▇▇ contained in this
Agreement, or any of the agreements, certificates, documents or exhibits
delivered in connection with this Agreement; (ii) the failure to comply with, or
the breach or default by Shareholders or ▇▇▇▇▇ of any of the covenants,
warranties or agreements made by Shareholders or ▇▇▇▇▇ contained in this
Agreement, or any of the agreements, certificates, documents or exhibits
delivered in connection with this Agreement; or (iii) the failure of the
Shareholders or Verex to comply with applicable securities laws or the rules and
regulations of the Federal Drug Administration.
(b) Notwithstanding anything contained in this Agreement, each of the
Shareholders and ▇▇▇▇▇ hereby agree that he or she will not make any claim of
indemnification against Verex by reason of the fact that they were a director,
officer, employee or agent of Verex, whether such claim is for judgment,
damages, penalties, fines, costs, amounts paid in settlement, losses, expenses
or otherwise or whether such claim is made pursuant to any statute, charter
document, bylaw, agreement or otherwise, with respect to any action, lawsuit,
proceeding, complaint, claim or demand arising out of events or facts existing
prior to the date hereof.
5.3 INDEMNIFICATION BY PRP. PRP covenants and agrees to defend, indemnify
and hold Shareholders and ▇▇▇▇▇ harmless for, from and against any and all
damages, losses, liabilities (absolute and contingent), fines, penalties, costs
and expenses (including, without limitation, reasonable counsel fees and costs
and expenses incurred in the investigation, defense or settlement of any claim
covered by this indemnify) with respect to or arising out of any demand, claim,
inquiry, investigation, proceeding, action or cause of action which Shareholders
or ▇▇▇▇▇ may suffer or incur by reason of: (a) the inaccuracy of any of the
representations or warranties of PRP contained in this Agreement, or any of the
agreements, certificates, documents or exhibits delivered in connection with
this Agreement; or (b) the failure to comply with, or the breach or default by
PRP of any of the covenants, warranties or agreements made by PRP contained in
this Agreement, or any of the agreements, certificates, documents or exhibits
delivered in connection with this Agreement.
Page 12
5.4 NOTICE AND RIGHT TO DEFEND THIRD-PARTY CLAIMS. Promptly upon receipt of
notice of any claim, demand or assessment or the commencement of any suit,
action or proceeding with respect to which indemnity may be sought pursuant to
this Agreement, the party seeking to be indemnified or held harmless (the
"Indemnitee") shall notify in writing, if possible, within sufficient time to
respond to such claim or answer or otherwise plead in such action (but in any
event within thirty (30) days), the party from whom indemnification is sought
(the "Indemnitor"). In case any claim, demand or assessment shall be asserted,
or suit, action or proceeding commenced against the Indemnitee, the Indemnitor
shall be entitled, at the Indemnitor's expense, to participate therein, and, to
the extent that it may wish, to assume the defense, conduct or settlement
thereof, at its own expense, with counsel satisfactory to the Indemnitee, whose
consent to the selection of counsel shall not be unreasonably withheld or
delayed, provided that the Indemnitor confirms to the Indemnitee that it is a
claim to which its rights of indemnification apply. The Indemnitor shall have
the right to settle or compromise monetary claims; however, as to any other
claim, the Indemnitor shall first obtain the prior written consent from the
Indemnitee, which consent shall be exercised in the sole discretion of the
Indemnitee. After notice from the Indemnitor to the Indemnitee of Indemnitor's
intent so to assume the defense, conduct, settlement or compromise of such
action, the Indemnitor shall not be liable to the Indemnitee for any legal or
other expenses (including, without limitation, settlement costs) subsequently
incurred by the Indemnitee in connection with the defense, conduct or settlement
of such action while the Indemnitor is diligently defending, conducting,
settling or compromising such action. The Indemnitor shall keep the Indemnitee
apprised of the status of the suit, action or proceeding and shall make
Indemnitor's counsel available to the Indemnitee, at the Indemnitor's expense,
upon the request of the Indemnitee. The Indemnitee shall cooperate with the
Indemnitor in connection with any such claim and shall make personnel, books and
records and other information relevant to the claim available to the Indemnitor
to the extent that such personnel, books and records and other information are
in the possession and/or control of the Indemnitee. If the Indemnitor decides
not to participate, the Indemnitee shall be entitled, at the Indemnitor's
expense, to defend, conduct, settle or compromise such matter with counsel
satisfactory to the Indemnitor, whose consent to the selection of counsel shall
not be unreasonably withheld or delayed.
SECTION 6
POST-CLOSING COVENANTS
6.1 ▇▇▇▇ EMPLOYMENT AGREEMENT. Contemporaneously with the execution and
delivery of this Agreement, PRP or Verex and ▇▇. ▇▇▇▇ shall enter into an
employment agreement in the form attached as Exhibit L, at the level of a PRP
senior manager. Contemporaneously with entering into this new employment
agreement, ▇▇. ▇▇▇▇'▇ existing employment agreement with Verex will be
terminated.
Page 13
6.2 ▇▇▇▇▇ EMPLOYMENT AGREEMENT. Contemporaneously with the execution and
delivery of this Agreement, PRP or Verex and ▇▇▇▇▇ will enter into an employment
agreement in the form attached as Exhibit M whereby Verex will employ ▇▇▇▇▇ at
the level of a Verex manager.
6.3 STOCK OPTIONS. As part of their Employment Agreements with PRP, PRP
will grant to ▇▇. ▇▇▇▇ and ▇▇▇▇▇ stock options or warrants substantially
consistent with their Verex options. Contemporaneously with the execution of
these warrants, ▇▇. ▇▇▇▇ and ▇▇▇▇▇ will terminate their option or warrant
agreements with Verex. Specifically, ▇▇. ▇▇▇▇ would receive a warrant to
purchase 40,000 Shares of PRP common stock, exercisable at $7.50 per Share, and
▇▇▇▇▇ would receive a warrant to purchase 23,333 Shares of PRP common stock,
exercisable at $7.50 per Share. The warrants shall vest and be exercisable
consistent with existing Verex options.
6.4 UNEXERCISED STOCK OPTIONS OR WARRANTS. Except as set forth in this
Section 6, each of the Shareholders and ▇▇▇▇▇ hereby agrees that each of the
other stock options or warrants to purchase shares of Verex capital stock are
terminated and of no further force or effect. Each of the parties hereto shall
take such actions as may be determined necessary or appropriate to cancel any
such stock options or warrants.
6.5 DIRECTORS AND OFFICERS OF VEREX. Each of ▇▇. ▇▇▇▇ and ▇▇▇▇▇ agrees to
remain as an officer and director of Verex for at least sixty (60) days after
the date hereof, or as otherwise reasonably requested by PRP to ensure an
orderly transition. Each of the other Shareholders shall resign as an officer
and/or director, as applicable, of Verex, as of the date hereof. To fill the
vacancies created by the resignations and otherwise, when requested by PRP, as
the sole remaining directors of Verex, ▇▇▇▇▇ and ▇▇. ▇▇▇▇ shall appoint up to
three (3) nominees of PRP to serve as directors of Verex.
6.6 PAYMENT OF ACCRUED SALARIES.
(a) ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇ has accrued salary of $395,833 as shown in
Verex's records. Subject to all the Shareholders and ▇▇▇▇▇ named above complying
with the terms of this Stock Purchase Agreement, PRP will make available through
secured, interest-bearing notes to Verex, sufficient funds to enable Verex to
pay such accrued salary as set forth on Exhibit K $9,146/month for 24 months
beginning February 1, 2000. A balloon payment in the amount of $176,321 will be
due on February 1, 2002. The balance represented by this balloon payment will
earn interest at the rate of seven percent (7%) per annum beginning February 1,
2000 until February 1, 2002. An additional interest payment of $7,683 will be
made to account for the outstanding balance of the first two years down
payments. Interest and principal will be due on February 1, 2002. In the event
that PRP is able to commercialize any of the products developed by Verex, the
following acceleration provision shall apply: Thirty point forty-nine percent
(30.49%) of the net profit from such commercialization will be used to
accelerate the payment of accrued salary. The acceleration payments will be made
to the balloon balance first, then applied to remaining monthly installments.
(b) ▇▇▇▇▇ has accrued salary of $253,333 as shown in Verex's records.
Subject to ▇▇▇▇▇ and all of the Shareholders complying with the terms of this
Stock Purchase Agreement, PRP will make available through secured,
interest-bearing notes to Verex, sufficient funds to enable Verex to pay such
accrued salary as follows: $5,854/month for 24 months beginning February 1,
2000. A balloon payment in the amount of $112,845 will be due on February 1,
Page 14
2002. The balance represented by this balloon payment will earn interest at the
rate of seven percent(7%) per annum beginning February 1, 2000 until February 1,
2002. An additional interest payment of $4,917 will be made to account for the
outstanding balance of the first two years down payments. Interest and principal
will be due on February 1, 2002. In the event that PRP is able to commercialize
any of the products developed by Verex, the following acceleration provision
shall apply: Nineteen point fifty-one percent (19.51%) of the net profit from
such commercialization will be used to accelerate the payment of accrued salary.
The acceleration payments will be made to the balloon balance first, then
applied to remaining monthly installments.
(c) The obligations to pay accrued salary set forth in this Section
6.6 will be honored to the extent consistent with applicable law and fiduciary
obligations.
6.7 PRESS RELEASES. No party shall issue, or shall cause Verex to issue,
any press release in whatever form, or make any publication in whatever form,
regarding this Agreement and/or regarding the discussions among the parties
hereto, without the express prior written approval of the parties hereto, unless
in the opinion of such parties' counsel that disclosure or publication is
required by law.
6.8 SECURITIES FILINGS. Each of the parties hereto shall timely make and
file, all filings and reports with the SEC, as may be required by the SEC or by
law.
6.9 FIDUCIARY OBLIGATIONS. As the majority Shareholder of Verex after the
consummation of the stock purchase contemplated by this Agreement, PRP
acknowledges that it will have certain fiduciary duties to the minority
shareholders of Verex. PRP agrees to act consistent with such duties.
6.10 TENDER OFFER. Within one hundred twenty (120) days after the issuance
of audited financial statements of Verex, PRP will file with the Securities and
Exchange Commission documents necessary to make a tender offer to purchase the
remaining shares of common stock of Verex then outstanding. Such tender offer
shall be at a price equal to fifteen (15) shares of PRP common stock for each
share of Verex common stock, or for cash at the price of $.50 per share of Verex
common stock. It is PRP's intention to make this tender offer to each holder of
at least 3,000 shares of Verex common stock in exchange for shares of PRP common
stock and to each holder of fewer than 3,000 shares of Verex common stock in
exchange for cash. Notwithstanding the foregoing, PRP shall not be required to
proceed with any tender offer if, as a result of the offer, PRP shall be deemed
to become a reporting company under the Securities Exchange Act of 1934, as
amended, or if the tender offer cannot be completed in compliance with federal
law or the laws of any applicable states or other jurisdictions. If such tender
offer would make PRP a reporting company or cannot be legally accomplished, PRP
will endeavor, in good faith, to find an alternative to accomplish the same
result at the same value. If audited financials of Verex are not issued on or
before the date that is eight (8) months after the date hereof, PRP shall have
no obligations hereunder. All parties hereto will use their reasonable best
efforts to ensure that up-to-date audited financial statements for Verex are
prepared as soon as reasonably practicable after the date hereof. PRP agrees to
fund Verex to pay for the audit.
Page 15
6.11 TRANSFER OF SHARES. PRP agrees that it will not unreasonably withhold
its consent, under PRP's Articles of Incorporation or otherwise, to any one
transfer of any shares of PRP acquired by Birklea hereunder or any obligations
of Birklea hereunder or under the Amendment to Royalty Agreement dated December
___, 1999, to another entity controlled by ▇▇▇▇ ▇▇▇▇▇▇▇▇, so long as the
acquiring entity agrees to be bound as a Shareholder to the terms hereof, and
Birklea agrees to continue to be bound to its obligations under this Agreement.
SECTION 7
GENERAL
7.1 CONTROLLING LAW. This Agreement, and all questions relating to its
validity, interpretation, performance, and enforcement, shall be governed by and
construed in accordance with the laws of Colorado, notwithstanding any Colorado
or other conflict-of-law provisions to the contrary. The parties agree that any
action brought by either party against the other in connection with any rights
or obligations arising out of this Agreement or any transaction contemplated
hereby shall be instituted properly in a Colorado court of competent
jurisdiction with venue only in the State of Colorado. The parties hereby agree
to submit personally to the jurisdiction of a court of competent subject matter
jurisdiction located in such State. In any action or proceeding to enforce
rights under this Agreement, the prevailing party shall be entitled to recover
costs and attorneys' fees.
7.2 NOTICES. Except to the extent otherwise set forth herein, all notices,
requests, demands, and other communications required or permitted under this
Agreement shall be in writing and shall be deemed to have been duly given, made
and received when personally delivered or when deposited in the United States
mails, first class postage prepaid, return receipt requested, or when sent by
overnight express delivery with a signature required upon receipt, or 24 hours
after being sent by facsimile with a confirmed copy, addressed as set forth
below:
If to PRP: With a copy to:
PR Pharmaceuticals, Inc. ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Ft. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Attention: President ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to ▇▇▇▇▇ ▇. ▇▇▇▇, M.D. and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇:
▇▇▇▇▇ ▇. ▇▇▇▇, M.D. and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone:__________________
Fax:____________________
Page 16
If to Raincrest Associates, LLC: With a copy to:
c/o ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇
Box 4426 ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone:__________________ Phone:__________________
Fax:____________________ Fax:____________________
If to Birklea, Ltd.: With a copy to:
Birklea, Ltd. _____________________________
C/o ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ Edge _____________________________
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ _____________________________
Phone:__________________ Phone:__________________
Fax:____________________ Fax:____________________
If to ▇▇▇▇ ▇▇▇▇▇: With a copy to:
▇▇▇▇ ▇▇▇▇▇ _____________________________
C/o ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ Edge _____________________________
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ _____________________________
Phone:__________________ Phone:__________________
Fax:____________________ Fax:____________________
If to ▇▇▇▇▇ ▇. ▇▇▇▇▇:
▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇
% Verex Laboratories, Inc.
▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone:__________________
Fax:____________________
Any party may alter the address to which communications or copies are to be
sent by giving notice to such other parties of change of address in conformity
with the provisions of this paragraph for the giving of notice.
7.3 BINDING NATURE OF AGREEMENT; NO ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except, as otherwise set forth herein, no party may
assign, delegate, or transfer its rights or obligations under this Agreement
without the prior written consent of the other parties hereto.
Page 17
7.4 NO THIRD PARTY BENEFICIARIES. Nothing in this Agreement or in any of
the other documents shall confer upon any person, other than the parties hereto
and their respective successors and permitted assigns, any rights or remedies
under or by reason of this Agreement.
7.5 ENTIRE AGREEMENT. This Agreement, together with the Schedules and
Exhibits attached and the Employment Agreements contemplated by Section 6,
contains the entire understanding among the parties hereto with respect to the
subject matter hereof and supersedes all prior and contemporaneous agreements
and understandings, inducements or conditions, express or implied, oral or
written, except as herein contained. The express terms hereof control and
supersede any course of performance and/or usage of the trade inconsistent with
any of the terms hereof. This Agreement may not be modified or amended other
than by an agreement in writing.
7.6 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.
7.7 CONSTRUCTION. The parties hereto acknowledge that each party was
represented by legal counsel (or had the opportunity to be represented by legal
counsel) in connection with this Agreement, and that each of them and their
counsel have reviewed and revised this Agreement, or have had an opportunity to
do so, and that any rule of construction to the effect that ambiguities are to
be resolved against the drafting party shall not be employed in their
interpretation of this Agreement or any amendments or any exhibits hereto or
thereto.
7.8 SURVIVAL OF REPRESENTATION, WARRANTIES AND AGREEMENTS. The parties
hereto mutually agree that the representations, warranties and agreements set
forth in this Agreement shall survive the purchase of the Shares and the
transactions contemplated by this Agreement and shall inure to the benefit of
the parties hereto and their respective heirs, personal representatives,
successors and assigns.
7.9 COSTS AND EXPENSES. Except as may otherwise be expressly provided
herein, each party shall pay all of its own costs and expenses incurred in
connection with the negotiation and preparation of and the closing of the
transactions under this Agreement, and all matters incident thereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
PR PHARMACEUTICALS, INC.
By:
-----------------------------
Name:
---------------------------
Its:
----------------------------
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇, M.D.
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
RAINCREST ASSOCIATES, LLC
By:
-----------------------------
Name:
---------------------------
Its:
----------------------------
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
BIRKLEA, LTD.
By:
-----------------------------
Name:
---------------------------
Its:
----------------------------
▇▇▇▇ ▇▇▇▇▇
By:
-----------------------------
Name:
---------------------------
Its:
----------------------------
EXHIBIT A SHAREHOLDER SHARE OWNERSHIP
EXHIBIT B FULL SHAREHOLDER LIST
EXHIBIT C STOCK OPTIONS AND WARRANTS
EXHIBIT D LIENS AND LIABILITIES
EXHIBIT E FURNITURE FIXTURES & EQUIPMENT
EXHIBIT F REAL PROPERTY, LEASES
EXHIBIT G VEREX TECHNOLOGY
EXHIBIT H CONTRACTS
EXHIBIT I EMPLOYEE LIABILITIES
EXHIBIT J SHAREHOLDER RELEASE
EXHIBIT K PAYMENT OF ACCRUED SALARIES
EXHIBIT L ▇▇▇▇ EMPLOYMENT AGREEMENT
EXHIBIT M ▇▇▇▇▇ EMPLOYMENT AGREEMENT
Page 18
EXHIBIT A
VEREX LABORATORIES, INC. STOCK
Certificate No.'s No. of PRP Shares
Shareholder Number of Verex Representing to be Issued
Name Shares Held Verex Shares in Exchange
---- ----------- ------------ -----------
▇▇▇▇▇ ▇. ▇▇▇▇, M.D. and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ 320,560 21,371
Raincrest Associates, LLC 53,850 3,590
Birklea, Ltd. 765,106 51,008
▇▇▇▇ ▇▇▇▇▇ 206,001 13,734
▇▇▇▇▇ ▇. ▇▇▇▇▇ -0- -0- -0-
Page 19
