Exhibit 99.1
STOCK PURCHASE AGREEMENT
This Agreement, dated as of the 18th day of July 2004, by and among Xxxxx
Xxxxxx ("Seller"), and the Whalehaven Fund ("Buyer") for the purchase from
Seller by Buyer of Two Hundred Thousand (200,000) shares of the Common Stock,
par value $0.50 per share (the "Shares"), of APPLIED DNA SCIENCES INC., a
corporation organized under the laws of the State of Nevada, U.S.A. (the
"Company") as set forth below.
BACKGROUND STATEMENT
WHEREAS, Seller desires to sell and Buyer desires to purchase from Seller
the Shares on the terms and subject to the conditions set forth in this
Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and intending to be legally bound, the parties agree as follows:
ARTICLE I
The Transaction
1.1 Sale and Purchase of Shares. On the terms and subject to the
conditions set forth in this Agreement, Seller hereby sells the Shares of Common
Stock of the Company to Buyer and Buyer purchases the Shares from Seller.
1.2 Appointment of Escrow Agent. Buyer and Seller agree to appoint Xxxxxx
Xxxxxxx, Esq. as escrow agent to receive Common Stock certificates and funds and
to make appropriate disbursements to Buyer and Seller. Xxxxxx Xxxxxxx'x office
is located at 000 0xx Xxxxxx, Xxx Xxxx, XX 00000.
1.3 Consideration.
1.3.1 Buyer shall pay to Seller for the Shares a total consideration
of One Hundred Thousand and 00/100 U.S. Dollars (US$100,000.00), payable on or
before Tuesday, August 3, 2004. Wiring instructions are attached hereto as
Exhibit "A."
1.3.2 Subject to payment as aforesaid, Seller shall cause to be
delivered to Buyer, through the Escrow Agent, one stock certificate for 200,000
shares upon the receipt of the bank wire in the amount of $100,000, with such
shares issued in the name of Buyer.
ARTICLE II
Representations and Warranties of Buyer
To induce Seller to enter into this Agreement, Buyer hereby represents and
warrants to, and agree with, Seller as follows:
2.1 Buyer's Sophistication, Etc. Buyer is a person/entity of such
knowledge, sophistication and experience in finance, securities, investments and
other business matters as to be able to protect Buyer's interests in connection
with this transaction and to evaluate adequately the merits and risks of
investment in the Shares. Buyer's investment in the Shares is not material when
compared to Buyer's total financial capacity. Buyer understands the many risks
of an investment in the Shares and can afford to bear such risks, including, but
not limited to, the risk of losing Buyers' entire investment in the Shares. As
used in all representations and warranties of Buyer herein, such representations
and warranties are made by and apply to both "Buyer" and all principals of
Buyer. Buyer is an Accredited Investor as that term is defined in Rule 501 under
the U.S. Securities Act of 1933, as amended.
2.2 Adequate Information; Scope of Examination. Regarding the Company, its
operations, business plan, financial condition, principals, management and all
other matters relating to this investment and Agreement: Buyer has full access
to the Company's reports as filed with the SEC on XXXXX; has received, carefully
read, and understands and is familiar with all materials that have been
requested by Buyer and the Company has answered all inquiries that Buyer has put
to it; Buyer has had access to all additional information (including, but not
limited to, the Company's business plan, its most recent private placement
memorandum and other financial and capitalization information) and has taken all
steps necessary to evaluate the merits and risks of investment in the Shares.
The scope of the examination made by Buyer in connection with purchase of the
Shares has been determined solely by Buyer based upon Buyer's own sophistication
and experience. Buyer acknowledges that Seller has not made any representations
or warranties regarding the Company or the Shares except as set forth in this
Agreement.
2.3 Non-U.S. Person. Buyer is not a "U.S. Person" as that term is defined
by Rule 902(k)(1) under the Securities Act and Buyers are not acquiring the
Shares for the account or benefit of any "U.S. Person." Buyer understands that
the definition of a "U.S. Person" includes, but is not limited to: (i) a natural
person resident in the United States; (ii) any partnership or corporation
organized or incorporated under the laws of the United States; and (iii) other
entities located in or administered by persons in the United States.
2.4 Execution outside U.S. Buyer is located outside the United States at
the time of execution of this Agreement.
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2.5 Investment Intent, Etc. Buyer is acquiring the Shares for Buyer's own
account for investment and not with a view to resale or distribution of the
Shares. Buyer has no present intention of distributing or selling the Shares to
others, has no need for liquidity of the Shares, and has no reason to expect a
change in Buyer's circumstances, financial or other, that may cause or require
sale of the Shares. Buyer acknowledges that the Company has no obligation to
register the Shares under U.S. securities laws.
2.6 Restrictions on Transferability of Shares.
2.6.1 Buyer acknowledges that Buyer has been advised by Seller that
the Shares have not been registered under the U.S. Securities Act of 1933, as
amended (the "Act"), that the Shares have been offered and are being sold to
Buyer on the basis of the exemption from registration provided by Regulation S
promulgated under the Act relating to offers and sales of securities made
outside the United States, as well as in reliance upon exemptions from
registration under the Act relating to transactions not involving any public
offering and under similar exemptions under applicable state securities laws,
that this transaction has not been filed with or reviewed by, passed on or
submitted to any U.S. federal or state agency or self-regulatory organization
where an exemption is being relied upon, and that the reliance of Seller upon
such exemptions is predicated on the accuracy of Buyer's representations and
warranties herein.
2.7 No Market for Shares. Buyer acknowledges that there is currently no
market for the Shares and there is no assurance that a market will develop in
the future. Buyer understands that it may be difficult or impossible to
liquidate Buyer's investment in the Shares when Buyer may desire or deem it
prudent to do so.
2.8 Authorization and Enforceability. Buyer has all requisite power and
authority to execute, deliver and perform this Agreement and to consummate the
purchase of the Shares contemplated hereby. This Agreement has been duly and
validly authorized, executed and delivered by Buyer and constitutes the legal,
valid and binding obligation of Buyer fully enforceable against Buyer in
accordance with its terms.
2.9 No Finder. Buyer has not taken any action which would give to any
firm, corporation, agency or other person a right to a consultant's or finder's
fee or any type of brokerage commission in connection with the transaction
contemplated by this Agreement.8
2.10 Nature of Transaction, Etc. Buyer acknowledges that Buyer's purchase
of the Shares is a private transaction between Buyer and Seller.
2.11 No Guarantee. Buyer acknowledges that it never has been represented,
guaranteed or warranted by Seller or the Company, or its principals, including
any of the officers, directors, shareholders, partners, employees or agents of
either, or any other persons, whether expressly or by implication, that:
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(a) the Company or Buyer will realize any given percentage of profits
and/or amount or type of consideration, profit or loss as a result of the
Company's activities or Buyer's investment in the Company; or
(b) the past performance or experience of the management of the
Company, or of any other person, will in any way indicate the predictable
results of the ownership of the Shares or of the Company's activities.
2.12 Risk Factors. Without limiting any of Buyer's other
representations and warranties hereunder, Buyer acknowledges that Buyer has
reviewed and is aware of the risk factors of investing in the Company.
2.13 Survival of Representations; Indemnification. Buyer acknowledges
that the representations, warranties and agreements made by Buyer herein shall
survive the execution and delivery of this Stock Purchase Agreement and the
purchase of the Shares. Buyer acknowledges that Buyer understands the meaning
and legal consequences of the representations and warranties contained in
Section 2 hereof, and hereby indemnifies and holds harmless the Seller, the
Company, their respective agents, employees and affiliates, from and against any
and all losses, claims, damages or liabilities due to or arising out of a breach
of any representation or warranty of the Buyer contained in this Agreement.
ARTICLE III
Representations and Warranties of Seller
Except as otherwise set forth herein or otherwise specifically disclosed,
Seller hereby represents and warrants to, and agrees with, Buyer as follows:
3.1 Good Title. Seller is the record and beneficial owner of and has legal
and valid title to the Shares, free and clear of all liens, pledges, charges,
claims and other encumbrances, actual or alleged. Delivery of the Shares to
Buyer will transfer to Buyer legal and valid title to the Shares, free and clear
of any liens, pledges, charges, claims and other encumbrances.
3.2 Authorization and Enforceability. Seller has all requisite power and
authority to execute, deliver and perform this Agreement and to consummate the
sale of the Shares contemplated hereby. This Agreement has been duly and validly
authorized, executed and delivered by Seller and constitutes the valid and
binding obligation of Seller fully enforceable in accordance with its terms.
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3.3 Effective Agreement. To the best of Seller's knowledge, execution,
delivery, and performance of this Agreement by Seller and consummation of sale
of the Shares as contemplated hereby will not, with or without the giving of
notice or lapse of time or both, result in a breach of or conflict with any
term, covenant, condition or provision of, result in the modification or
termination of, constitute a default under, or result in the creation or
imposition of any lien, security interest, charge, claim or other encumbrance
upon or against Seller, or any of its properties or assets, pursuant to the
terms of any charter, bylaw, commitment, contract or other agreement or
instrument to which Seller or the Company is a party or by which any of their or
its assets or properties is or may be bound or affected or from which the
Company derives a benefit, which would have a material adverse affect on the
value of the Shares.
3.4 Restrictions, Burdensome Agreements. Seller is not a party to any
contract, commitment or agreement, and neither the Company nor the Seller or any
of their respective properties and assets are subject to or bound or affected
by, any charter, bylaw or other corporate restriction or any order, judgment,
decree, law, statute, ordinance, rule, regulation or other restriction of any
kind or character that would prevent Seller from entering into this Agreement or
from consummating the sale of the Shares contemplated hereby.
3.5 Nature of Transaction, Etc. Seller acknowledges that Buyer's purchase
of the Shares is a private transaction between Buyer and Seller. Seller further
acknowledges that the Shares have "come to rest" with Seller before the purchase
of the Shares by Buyer.
ARTICLE IV
General Provisions
4.1 Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given when
personally delivered or, if mailed, seven (7) days after being deposited in the
U.S. mails, proper postage prepaid, addressed to the other party as follows (or
at such other address as shall be given by notice hereunder by either party to
the other):
4.1.1 If to Buyers, then to:
Whalehaven Fund
Desjardins Securities
Attn: Xxxxx Xxxxx
000 Xxxx Xx X
Xxxxx 0000
Xxxxxxx, XX
X0X 0X0
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4.1.2 If to Seller, then to:
Xx. Xxxxx Xxxxxx
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
with a copy to:
Xxxxxx Xxxxxxx
000 0xx Xxxxxx
Xxx Xxxx, XX 00000
4.2 Successors and Assigns. This Agreement, and all rights and powers
granted hereby, shall bind and inure to the benefit of the parties and their
respective successors and assigns.
4.3 Governing Law, Etc. This Agreement has been made, executed and
delivered in and is to be governed and construed in accordance with the laws of
the State of Nevada as in effect for contracts made and to be performed in the
State of Nevada. Each of the parties hereby submits to the jurisdiction of the
courts of, and the federal courts located in, the State of Texas, which courts
shall have exclusive jurisdiction of all matters related to this Agreement and
the transaction contemplated hereby.
4.4 Captions. The captions in this Agreement are solely for convenience of
reference and do not constitute a part of this Agreement, nor shall they affect
its meaning, construction or effect.
4.5 Further Assurances. Each party shall cooperate and execute such
documents and instruments and take such action as may be reasonably requested by
the other party in order to carry out the provisions and purposes of this
Agreement and the transaction contemplated hereby.
4.6 Amendment and Waiver. The parties may by mutual agreement amend this
Agreement in any respect, and any party, but only as to such party, may (a)
extend the time for the performance of any of the obligations of any other
party; (b) waive any inaccuracies in representations by any other party; (c)
waive compliance by any other party with any of its agreements contained herein
and the performance of any obligation by such other party; and (d) waive the
fulfillment of any condition that is precedent to the performance by such party
of any of its obligations under this Agreement. To be effective, all such
amendments or waivers must be in writing and be signed by the party against whom
enforcement of the amendment or waiver is sought.
4.7 Entire Agreement. This Agreement, including all Exhibits hereto, sets
forth all of the representations, warranties, promises, covenants, agreements,
understandings, conditions, inducements and other terms between the parties
hereto regarding the subject matter hereof, and supersedes all prior,
contemporaneous and other representations, warranties, promises, covenants,
agreements, understandings, conditions or inducements, if any, expressed or
implied, oral or written.
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4.8 Waiver and Hold Harmless. Both Buyer and Seller acknowledge that the
preparer of this document, Law Office of Xxxxxx Xxxxxxx, LTD. has prepared this
document solely to facilitate the sale of the Shares from Seller to Buyer. As
such, Buyer and Seller each hereby agrees to indemnify and hold preparer
harmless from any disputes arising between Buyer and Seller in connection with
this Agreement and the sale of the Shares, and from any costs and expenses which
may be incurred by preparer in connection therewith. Further, Buyer and Seller
acknowledge that no legal advice has been rendered by the preparer of this
document to either Buyer or Seller, that they each have had an adequate
opportunity to have their own respective counsel review this Agreement and have
sought and do acknowledge seeking individual legal, accounting and investment
advice from their own accountants, lawyers and other professionals to the extent
deemed desirable to them in their sole discretion. Both Seller and Buyer consent
to preparer's being the scrivener of this document and acknowledge that preparer
was previously counsel for Applied DNA Sciences, and now represents Applied DNA
Sciences through Sichenzia Xxxx Xxxxxxxx Xxxxxxx LLP and as such do not
represent either Buyer or Seller in this transaction.
4.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same agreement.
IN WITNESS WHEREOF, each of the parties has executed this Agreement as of
the date first above written.
SELLER: BUYER:
/s/ Xxxxx Xxxxxx Whalehaven Fund Limited
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Xxxxx Xxxxxx By: /s/ Evan Schemenour
Its: Director
