Exhibit 10.27
ALFACELL CORPORATION
PURCHASE AGREEMENT FOR
COMMON STOCK & WARRANTS
Alfacell Corporation
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Kuslima Shogen, Chairman
and Chief Executive Officer
Dear Ms. Shogen:
The undersigned acknowledges that there is no minimum proceeds requirement
for the closing of this Offering, the Company may close only on the
undersigned's investment and such investment may be inadequate to meet the
Company's cash requirements. The Company intends to utilize the proceeds of this
Offering for research and development and general corporate purposes.
The undersigned hereby subscribes to purchase 200,000 units at $0.50 per
unit (the "Unit"). Each Unit consists of one share of Common Stock, $.001 par
value per share (the "Shares") of Alfacell Corporation, a Delaware corporation
(the "Company") and one five-year warrant (the "Warrants"). The Warrants are
exercisable into one Share (the "Warrant Shares"). The Shares, the Warrants and
the Warrant Shares are being sold in a transaction exempt from registration
under the Securities Act of 1933, as amended (the "Act"). The Warrants will be
issued pursuant to a Warrant Agreement in the form attached hereto as Exhibit A
executed by the Company for the benefit of the undersigned. The Warrants will be
exercisable at $1.50 for a five-year period commencing three months after its
issuance. The undersigned tenders herewith $100,000 in full payment of the
purchase price for the 200,000 Units to which the undersigned subscribes (in the
manner indicated on the signature page hereof.)
The undersigned understands that the right to transfer all or any part of
the Shares, the Warrants and the Warrant Shares (hereinafter sometimes
collectively referred to as the "Securities") will be restricted. The
undersigned may not transfer the Securities unless they are registered under the
Act and applicable state securities or "blue sky" laws, or an exemption from
such registration is available. The undersigned recognizes that the Company
shall have no obligation to register the Securities, except as set forth herein.
The undersigned hereby represents, warrants and covenant that:
1. The undersigned is acquiring the Shares and the Warrants, and at such
time as the undersigned may exercise the Warrants, the Warrant Shares, for the
undersigned's own account for investment and not with a view towards
distribution. The undersigned will not sell, hypothecate, transfer or otherwise
dispose of the Securities unless such transaction has been registered under the
Act or, in the opinion of counsel for the Company, an exemption from
registration is available.
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2. (i) Please check here if the representation contained in this paragraph
2(i) is applicable to the undersigned _____________. (A)If an individual, (a)
the undersigned's individual net worth or joint net worth with the undersigned's
spouse exceeds $1,000,000 as of the date hereof, or (b) the undersigned's
individual income has been in excess of $200,000 in each of 2000 and 1999 and is
expected to be in excess of $200,000 in 2001, or (c)the undersigned's joint
income with the undersigned's spouse has been in excess of $300,000 in each of
2000 and 1999 and is expected to be in excess of $300,000 in 2001; or (B) if a
corporation, partnership, or other entity, the foregoing representation applies
to all of the equity owners of the corporation, partnership, or entity.
(ii) If a corporation, partnership, or other entity, was such a
corporation, partnership, or other entity formed for the specific purpose of
acquiring the Shares? _____Yes _____ No
(iii) If the answer to 2(ii) is yes, how many equity owners does the
corporation partnership or entity have? _____
3. Whether or not the representation contained in paragraph 2(i)is
applicable to the undersigned, the undersigned has adequate means of providing
for the undersigned's current needs and possible contingencies and has no need
for liquidity of the Securities. The undersigned's overall commitment to
investments is not disproportionate to the undersigned's net worth, and
acquisition of the Securities will not cause such overall commitment to become
excessive. Prior to the execution hereof, the undersigned has received and had
the opportunity to review, examine and read all documents, records and books
pertaining to this investment, including the Company's Annual Report on Form
10-K for the fiscal year ended July 31, 2001, the Company's Quarterly Reports on
Form 10-Q for each of the three quarterly periods subsequent to the fiscal year
ended July 31, 2001 collectively, the "Disclosure Documents").
4. The undersigned is knowledgeable and experienced in financial and
business matters. The undersigned recognizes and is fully cognizant of the fact
that the investment contemplated hereby involves a high degree of risk. The
undersigned is able to evaluate the merits and risks of an investment in the
Securities. The undersigned has been given an opportunity to ask questions of,
and receive answers and obtain information from, representatives of the Company
concerning the Company.
5. The undersigned has been given no oral or written representations or
assurances by the Company or any other person acting or purporting to act on
behalf of the Company in connection with the acquisition of the Securities, in
each case except as provided herein or in the Disclosure Documents.
6. The undersigned understands and specifically acknowledges and agrees
that since the Securities have not been registered under the Act, the
certificates representing the Securities will bear a legend to such effect and a
stop transfer order will be placed on the Securities in the Company's transfer
books.
7. By its acceptance hereof, the Company hereby agrees that it shall use
its best efforts to file a registration statement (the "Registration Statement")
under the Act to register the resale of the Shares and the
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Warrant Shares. The Company further agrees to use its best efforts to cause such
Registration Statement to become effective.
In connection with the Registration Statement, the undersigned shall
provide the Company, from time to time, as reasonably requested by the Company,
written information concerning its ownership of the Company's Securities, their
intentions concerning the sale of its Shares and Warrant Shares and such other
matters as are required in order to enable the Company to prepare, file and
obtain the effectiveness of such Registration Statement. Notwithstanding any of
the foregoing, the Company shall not be required to maintain the effectiveness
of the Registration Statement for more than two (2) years after the initial
effective date thereof.
In connection with any such registration of Shares and Warrant Shares, the
Company shall supply a reasonable number of prospectuses to the undersigned, use
its best efforts to qualify the Shares and Warrants for sale in the states of
New York and New Jersey and furnish indemnification in the manner set forth
below.
The Company shall bear the entire cost and expense of any such registration
hereunder. Notwithstanding the foregoing, the undersigned shall bear the fees of
all persons retained by it, such as counsel and accountants, and any transfer
taxes or underwriting discounts or commissions applicable to the Shares and
Warrant Shares sold by it pursuant to the Registration Statement.
The Company shall indemnify and hold harmless each holder of Shares and
Warrant Shares that are registered pursuant to the Registration Statement and
each underwriter, within the meaning of the Act, who may purchase from or sell
for any such holder any such Shares or Warrant Shares and each person, if any,
who controls any such holder or underwriter within the meaning of the Act, from
and against any and all losses, claims, damages and liabilities caused by any
untrue statement of a material fact contained in the Registration Statement or
any post-effective amendment thereto or any prospectus included therein required
to be filed or furnished in connection therewith or caused by any omission to
state therein a material fact required to be stated therein in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission based upon
information furnished or required to be furnished in writing to the Company by
such holder or underwriter expressly for use therein; provided, however, that
such holder or underwriter shall indemnify the Company, its directors, each
officer signing the Registration Statement and each person, if any, who controls
the Company within the meaning of the Act, from and against any and all losses,
claims, damages and liabilities caused by any untrue statement of a material
fact contained in any Registration Statement or any post-effective amendment
thereto or any prospectus included therein required to be filed or furnished
pursuant thereto or caused by any omission to state therein a material fact
required to be stated therein in order to make the statements made therein, in
light of the circumstances under which they were made, not misleading, insofar
as such losses, claims, damages or liabilities are caused by any untrue
statement or omission based upon information furnished in writing to the Company
by any such holder or underwriter expressly for use therein.
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If the indemnification provided for herein from either the holder of the
Shares and Warrant Shares or the Company is unavailable to an indemnified party
(the "Indemnitee") hereunder in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to herein, then the party
responsible for such indemnification (the "Indemnitor"), in lieu of indemnifying
the Indemnitee, shall contribute to the amount paid or payable by the Indemnitee
as a result of such losses, claims, damages or liabilities in such proportion as
is appropriate to reflect the relative fault of the Indemnitor and Indemnitee in
connection with the actions which resulted in such losses, claims, damages or
liabilities (including legal or other fees and expenses reasonably incurred in
connection with any investigation or proceeding) as well as any other equitable
considerations.
If indemnification is available, the Indemnitor shall indemnify each
Indemnitee to the full extent provided for herein without regard to the relative
fault of the Indemnitor, the Indemnitee or any other equitable consideration
provided for hereunder.
After the Registration Statement becomes effective and in connection with
the sale of the Shares and Warrant Shares under such Registration Statement, the
undersigned shall take such steps as may be necessary to ensure that the offer
and sale thereof are in compliance with the requirements of the federal
securities laws, including, but not limited to, compliance with the
anti-manipulation requirements of the Securities Exchange Act of 1934, as
amended.
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By its acceptance hereof, the Company hereby acknowledges that the
foregoing accurately reflects its understanding concerning the transaction
contemplated hereby.
Very truly yours,
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(Signature)
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Please type or print name
(and title if applicable)
Name & Address (as it should appear
on certificates):
-----------------------------------
-----------------------------------
-----------------------------------
Social Security Number or
Taxpayer Identification Number
(H) (W)
--------------- -------------
Telephone Number
As of Date
Number of Units
Amount of Subscription
(U.S. Dollars)
ACCEPTED AND AGREED: Deliver to Address: (if
ALFACELL CORPORATION different from above)
------------------------------------
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Name: Kuslima Shogen
Title: Chairman and CEO
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Exhibit A
WARRANT TO PURCHASE ___________ SHARES OF COMMON STOCK VOID AFTER 5:00 p.m.
NEW JERSEY TIME, ON ________________. THIS WARRANT AND THE SHARES OF COMMON
STOCK ISSUABLE UPON THE EXERCISE HEREOF HAVE BEEN AND WILL BE ISSUED IN
TRANSACTIONS WHICH HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR UNDER ANY STATE SECURITIES OR BLUE SKY LAWS. THIS
WARRANT AND SUCH SHARES MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF, IN WHOLE OR IN PART, IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE LAW, OR AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
NO. SHARES
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ALFACELL CORPORATION
This certifies that, for value received, ___________________________, the
registered holder hereof or assigns (the "Warrantholder") is entitled to
purchase from Alfacell Corporation, a Delaware corporation (the "Company"), at
any time on and after ___________________, and before 5:00 p.m., New Jersey
time, on _______________ (the "Termination Date"), at the purchase price of
$1.50 per share (the "Exercise Price"), the number of shares of Common Stock,
par value $.001 per share, of the Company set forth above (the "Warrant Stock").
The number of shares of Warrant Stock, the Termination Date and the Exercise
Price per share of this Warrant shall be subject to adjustment from time to time
as set forth below.
SECTION I. TRANSFER OR EXCHANGE OF WARRANT.
The Company shall be entitled to treat the Warrantholder as the owner in
fact hereof for all purposes and shall not be bound to recognize any equitable
or other claim to or interest in this Warrant on the part of any other person.
This Warrant shall be transferable only on the books of the Company, maintained
at its principal office upon delivery of this Warrant Certificate duly endorsed
by the Warrantholder or by his duly authorized attorney or representative, or
accompanied by proper evidence of succession, assignment or authority to
transfer. Upon any registration of transfer, the Company shall deliver a new
Warrant Certificate or Certificates to the persons entitled thereto.
SECTION II. TERM OF WARRANT; EXERCISE OF WARRANTS.
A. Termination. The Company may, in its sole discretion, extend the
Termination Date with respect to the exercise of this Warrant upon notice to the
Warrantholder. As used herein, "Termination Date" shall be deemed to include any
such extensions.
B. Exercise. This Warrant shall be exercised by surrender to the Company,
at its principal office, of this Warrant Certificate, together with the Purchase
Form attached hereto duly completed and signed, and upon payment to the Company
of the Exercise Price for the number of shares of Warrant
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Stock in respect of which this Warrant is then exercised. Payment of the
aggregate Exercise Price shall be made in cash or by certified or official bank
check.
C. Warrant Certificate. Subject to Section III hereof, upon such
surrender of this Warrant Certificate and payment of the Exercise Price as
aforesaid, the Company shall issue and cause to be delivered to or upon the
written order of the Warrantholder a certificate or certificates for the number
of full shares of Warrant Stock so purchased upon the exercise of such Warrant,
together with cash, as provided in Section VI hereof, in respect of any
fractional shares of Warrant Stock otherwise issuable upon such surrender. Such
certificate or certificates representing the Warrant Stock shall be deemed to
have been issued and any person so designated to be named therein shall be
deemed to have become a holder of record of such shares of Warrant Stock as of
the date of receipt by the Company of this Warrant Certificate and payment of
the Exercise Price as aforesaid; provided, however, that if, at the date of
surrender of this Warrant Certificate and payment of the Exercise Price, the
transfer books for the Warrant Stock or other class of stock purchasable upon
the exercise of this Warrant shall be closed, the certificate or certificates
for the shares of Warrant Stock in respect of which this Warrant is then
exercised shall be deemed issuable as of the date on which such books shall next
be opened (whether before or after the Termination Date) and until such date the
Company shall be under no duty to deliver any certificate for such shares of
Warrant Stock; provided further, however, that the transfer books of record,
unless otherwise required by law, shall not be closed at any one time for a
period longer than twenty (20) days. The rights of purchase represented by this
Warrant shall be exercisable, at the election of the Warrantholder, either in
full or from time to time in part, and, in the event that this Warrant is
exercised in respect of fewer than all of the shares of Warrant Stock
purchasable on such exercise at any time prior to the Termination Date, a new
Warrant Certificate evidencing the remaining Warrant or Warrants will be issued,
and the Company shall deliver the new Warrant Certificate or Certificates
pursuant to the provisions of this Section.
SECTION III. PAYMENT OF TAXES.
The Company will pay all documentary stamp taxes, if any, attributable to
the initial issuance of the shares of Warrant Stock upon the exercise of this
Warrant; provided, however, that the Warrantholder shall pay any tax or taxes
which may be payable in respect of any transfer involved in the issue or
delivery of Warrant Certificates or the certificates for the shares of Warrant
Stock in a name other than that of the Warrantholder in respect of which this
Warrant or shares of Warrant Stock are issued.
SECTION IV. MUTILATED OR MISSING WARRANT CERTIFICATES.
In case this Warrant Certificate shall be mutilated, lost, stolen or
destroyed, the Company shall, at the request of the Warrantholder, issue and
deliver, in exchange and substitution for and upon cancellation of this
certificate if mutilated, or in lieu of and in substitution for this certificate
if lost, stolen or destroyed, a new Warrant Certificate of like tenor and
representing an equivalent right or interest, but only upon receipt of evidence
satisfactory to the Company of such loss, theft or destruction of this Warrant
Certificate and indemnity, if requested, also satisfactory to the Company.
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SECTION V. RESERVATION OF SHARES OF WARRANT STOCK.
There has been reserved, and the Company shall at all times keep reserved
so long as this Warrant remains outstanding, out of its authorized Common Stock
a number of shares of Common Stock sufficient to provide for the exercise of the
rights of purchase represented by this Warrant. The transfer agent for the
Common Stock and every subsequent transfer agent for any shares of the Company's
capital stock issuable upon the exercise of this Warrant will be irrevocably
authorized and directed at all times to reserve such number of authorized shares
as shall be requisite for such purpose.
SECTION VI. FRACTIONAL SHARES.
No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of this Warrant. With respect to any fraction of a
share called for upon the exercise of this Warrant, the Company shall pay to the
Warrantholder an amount in cash equal to such fraction multiplied by the current
market price of such fractional share. "Market Price", as of any date means, (i)
the last reported sale price for the shares of Common Stock as reported by the
National Association of Securities Dealers Automated Quotation National Market
System, ("NASDAQ-NMS"), (ii) the closing bid price for the shares of Common
Stock as reported by the National Association of Securities Dealers Automated
Quotation System ("NASDAQ") if the shares are not traded on NASDAQ-NMS, (iii)
the average of the closing bid and closing asked prices of the Common Stock as
reported by the National Quotations Bureau if the shares are not traded on
NASDAQ; (iv) the last reported sale price, if the shares of Common Stock are
listed on a national securities exchange or (v) if market value cannot be
calculated as of such date on any of the foregoing basis, the fair market price
determined by the Board of Directors of the Company, acting with reasonable
business judgment.
SECTION VII. EXERCISE PRICE; ANTI-DILUTION PROVISIONS.
A. Exercise Price. The shares of Warrant Stock shall be purchasable upon
the exercise of this Warrant, at a price of $1.50 per share. The Company may, in
its sole discretion, reduce the Exercise Price applicable to the exercise of
this Warrant upon notice to the Warrantholder. As used herein, "Exercise Price"
shall be deemed to include any such reduction.
If the Company shall at any time issue Common Stock by way of dividend or
other distribution on any stock of the Company or effect a stock split or
reverse stock split of the outstanding shares of Common Stock, the Exercise
Price shall be proportionately decreased in the case of such issuance (on the
day following the date fixed for determining stockholders entitled to receive
such dividend or other distribution or such stock split) or increased in the
case of such reverse stock split (on the date that such reverse stock split
shall become effective), by multiplying the Exercise Price in effect immediately
prior to the stock dividend or other distribution, stock split or reverse stock
split by a fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately prior to such stock dividend or other
distribution, stock split or reverse stock split, and the denominator of which
is the number of shares of Common Stock outstanding immediately after such stock
dividend or other distribution, stock split or reverse stock split.
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B. No Impairment. The Company (a) will not increase the par value of any
shares of stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and (b) will take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant.
C. Number of Shares Adjusted. Upon any adjustment of the Exercise Price
pursuant to this Warrant, the Warrantholder shall thereafter (until another such
adjustment) be entitled to purchase upon the exercise of this Warrant, at the
new Exercise Price, the number of shares, calculated to the nearest full share,
obtained by multiplying the number of shares of Warrant Stock initially issuable
upon exercise of this Warrant by the Exercise Price in effect on the date hereof
and dividing the product so obtained by the new Exercise Price.
SECTION VIII. RECLASSIFICATION, REORGANIZATION OR MERGER.
In case of any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the Company (other than a change in par
value or as a result of an issuance of Common Stock by way of dividend or other
distribution or of a stock split or reverse stock split) or in case of any
consolidation or merger of the Company with or into another corporation (other
than a merger with a subsidiary in which merger the Company is the continuing
corporation and which does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock of the
Company issuable upon exercise of this Warrant) or in case of any sale or
conveyance to another corporation of the property of the Company as an entirety
or substantially as an entirety, the Company shall cause effective provision to
be made so that the Warrantholder shall have the right thereafter, by exercising
this Warrant, to purchase the kind and amount of shares of stock and other
securities and property the Warrantholder would have been entitled to receive if
the Warrantholder had exercised this Warrant immediately prior to such
reclassification, capital reorganization or other change, consolidation, merger,
sale or conveyance. Any such provision shall include provision for adjustments
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Warrant. The foregoing provisions of this Section shall
similarly apply to successive reclassifications, capital reorganizations and
changes of shares of Common Stock and to successive consolidations, mergers,
sales and conveyances.
SECTION IX. REGISTRATION RIGHTS.
A. The Warrantholder shall have the registration rights with respect to
the resale of the Warrant Stock as set forth in Section 7 of the Purchase
Agreement by and between the Company and the Warrantholder of even date
herewith.
SECTION X. NOTICES TO WARRANTHOLDERS.
So long as this Warrant shall be outstanding and unexercised (a) if the
Company shall pay any dividend or make any distribution upon the Common Stock or
(b) if the Company shall offer to the holders of Common Stock for subscription
or purchase by them any shares of stock of any class or any other rights or (c)
if any capital reorganization of the Company, reclassification of the capital
stock of the Company, consolidation or merger
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of the Company with or into another corporation, sale, lease or transfer of all
or substantially all of the assets of the Company to another corporation, or the
voluntary or involuntary dissolution, liquidation or winding up of the Company
shall be effected, then, in any such case, the Company shall cause to be
delivered to the Warrantholder, at least ten days prior to the date specified in
(i) or (ii) below, as the case may be, a notice containing a brief description
of the proposed action and stating the date on which (i) a record is to be taken
for the purpose of such dividend or distribution, or (ii) such reclassification,
reorganization, consolidation, merger, conveyance, lease, dissolution,
liquidation or winding up is to take place and the date, if any, as of which the
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities or other property deliverable upon such
reclassification, reorganization, consolidation, merger, conveyance,
dissolution, liquidation or winding up.
SECTION XI. NOTICES.
Any notice pursuant to this Warrant by the Company or by the Warrantholder
shall be in writing and shall be deemed to have been duly given if delivered or
mailed certified mail, return receipt requested, (a) if to the Company, to it at
000 Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000, Attention: Chief Executive
Officer and (b) if to the Warrantholder to the Warrantholder at the address set
forth on the signature page hereto. Each party hereto may from time to time
change the address to which such party's notices are to be delivered or mailed
hereunder by notice in accordance herewith to the other party.
SECTION XII. SUCCESSORS.
All the covenants and provisions of this Warrant by or for the benefit of
the Company or the Warrantholder shall bind and inure to the benefit of their
respective successors and assigns hereunder.
SECTION XIII. APPLICABLE LAW.
This Warrant shall be deemed to be a contract made under the laws of the
State of Delaware applicable to agreements made and to be performed entirely in
Delaware and for all purposes shall be construed in accordance with the internal
laws of Delaware without giving effect to the conflicts of laws principles
thereof.
SECTION XIV. BENEFITS OF THIS WARRANT.
Nothing in this Warrant shall be construed to give to any person or
corporation other than the Company and the Warrantholder any legal or equitable
right, remedy or claim under this Warrant and this Warrant shall be for the sole
and exclusive benefit of the Company and the Warrantholder.
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IN WITNESS WHEREOF, the parties hereto have executed this Warrant
Certificate or caused this Warrant Certificate to be duly executed as of the day
and year first above written.
ALFACELL CORPORATION
By: ______________________
Name: Kuslima Shogen
Title: Chairman and Chief
Executive Officer
WARRANTHOLDER
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Name:
Address:
Social Security or
Taxpayer Identification Number
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PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the Warrant
represented by this Warrant Certificate to the extent of _____ shares of Common
Stock, par value $.001 per share, of Alfacell Corporation, and hereby makes
payment of $_______ in payment of the actual exercise price thereof.
Name: ___________________________________________________________
(Please type or print in block letters)
Address:_________________________________________________________
(Address for delivery of Stock Certificate)
Social Security or
Taxpayer Identification Number:__________________________________
Signature:_______________________________________________________
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ASSIGNMENT FORM
FOR VALUED RECEIVED, _________________________________ hereby sells, assigns and
transfers unto _________________________________________________________________
(Please type or print in block letters)
Address_________________________________________________________________________
the right to purchase Common Stock, par value $.001 per share, of Alfacell
Corporation, represented by this Warrant Certificate to the extent of __________
shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ______________________, to transfer the same on the books
of the Company with full power of substitution in the premises.
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Signature
Dated:
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Notice: The signature of this assignment
must correspond with the name as it
appears upon the face of this Warrant
Certificate in every particular, without
alteration or enlargement or any change
whatever.
SIGNATURE GUARANTEED:
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