Exhibit 10.21
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT made as of the 31st day of October, 1997,
between AyurCore Inc., a Delaware corporation, whose principal offices are
located at 0000 X. Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx, Xxxxxxxxxx 00000 (the
"Company"), and Xxxx Xxxxxxx (the "Purchaser").
WHEREAS, the Company desires to issue and sell to the Purchaser, and the
Purchaser desires to purchase from the Company, that number of shares set
forth on the signature page hereto (the "Shares") of the Company's Common
Stock, $.001 par value per share (the "Common Stock"), on the terms and
conditions hereinafter set forth.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereto do hereby agree as
follows:
I. AGREEMENT OF PURCHASE AND SALE
1.1 Subject to the terms and conditions hereinafter set forth, the
Purchaser agrees to purchase the Shares from the Company and the Company
agrees to issue and sell the Shares to the Purchaser.
1.2 The purchase price for the Shares shall be $4.00 per Share and shall
be paid by the tender to the Company for cancellation of all principal and
accrued interest owing to the Purchaser under the Company's (i) Convertible
Promissory Note, dated October 14, 1994, and (ii) Promissory Note, dated
April 4, 1996 (such notes, copies of which are attached hereto as Exhibit A
and Exhibit B, respectively, the "Notes") owned by the Purchaser.
1.3 Simultaneously with the execution of this Agreement, the Purchaser
is delivering the Notes to the law firm of Xxxxx Xxxx Xxxxx Constant &
Xxxxxxxx to be held in escrow pending an amendment to the Company's charter
(i) reclassifying the Company's Class A and Class B common stock into one
class of common stock and (ii) increasing the number of authorized but
unissued shares of common stock to make available a sufficient number of
shares for the issuance of the Shares contemplated hereby (the "Charter
Amendment"). Effectiveness of the Charter Amendment shall be deemed a
condition precedent to the purchase and sale of the Shares contemplated
hereby.
1.4 The Purchaser hereby authorizes and directs the Company to deliver
the Shares to be issued to the Purchaser pursuant to this Agreement to the
address set forth on the signature page hereto.
1.5 The Purchaser understands that the Company reserves the right to
reject the purchase of the Shares hereunder if any of the Purchaser's
representations contained herein shall prove to be untrue.
II. REPRESENTATIONS BY THE PURCHASER
2.1 The Purchaser recognizes that an investment in the Company is highly
speculative and subject to a high degree of risk. The Purchaser understands
that the Company is in need of immediate substantial additional financing in
order to meet its business objectives. The Purchaser understands that if the
Company is not able to obtain additional financing, the Company will not be
able to conduct its operations and Purchaser will in all likelihood lose a
substantial portion or all of the Purchaser's investment. The Purchaser
acknowledges that the Company is in the development stage and has not
conducted any significant operations to date or received any meaningful
operating revenues and expects to incur operating losses for the foreseeable
future. The Purchaser acknowledges that there is no assurance that the
Company will ever achieve meaningful revenues or profitable operations. The
Purchaser is aware of the problems, delays, expenses and difficulties
encountered by an enterprise in the Company's stage of development, many of
which may be beyond the Company's control. These include, but are not
limited to, unanticipated problems relating to product development, testing,
regulatory compliance, manufacturing costs, production and marketing
problems, additional costs and expenses that may exceed current estimates and
competition.
2.2 The Purchaser acknowledges that the Purchaser must be a qualified
investor, as described herein, to qualify for the purchase of the Shares, and
that the Purchaser must be able to bear the economic risk of this investment.
2.3 The Purchaser represents that the Purchaser is an "accredited
investor" as such term is defined in Rule 501 of Regulation D promulgated
under the Shares Act of 1933, as amended (the "Act").
2.4 The Purchaser acknowledges that the Purchaser has prior investment
experience, including investment in non-listed and non-registered securities,
or the Purchaser has employed the services of an investment advisor, attorney
or accountant to read all of the documents furnished or made available by the
Company to the Purchaser and to evaluate the merits and risks of such an
investment on the Purchaser's behalf; that the Purchaser recognizes the
highly speculative nature of this investment; and is able to bear the
economic risk the Purchaser hereby assumes.
2.5 The Purchaser represents that the Purchaser has been furnished by
the Company during the course of this transaction with
all information regarding the Company which the Purchaser had requested or
desired to know; that all documents which could be reasonably provided have
been made available for the Purchaser's inspection and review; that the
Purchaser has been afforded the opportunity to ask questions of and receive
answers from duly authorized officers or other representatives of the Company
concerning the terms and conditions of the investment, and any additional
information which the Purchaser had requested; and that the Company has made
no representations concerning the Company except as set forth herein.
2.6 The Purchaser acknowledges that this transaction has not been
reviewed by the Securities and Exchange Commission ("SEC") and is intended to
be exempt from the registration requirements of the Act. The Purchaser
represents that the Shares being purchased hereunder are being purchased for
the Purchaser's own account, for investment and not for distribution or
resale to others. The Purchaser agrees that the Purchaser will not sell or
otherwise transfer such securities or any interest in such securities unless
they are registered under the Act or unless an exemption from such
registration is available. The Purchaser further agrees that notwithstanding
the availability, if any, of any such exemption, the Purchaser will not sell
or otherwise transfer the Shares or any interest in the Shares except in
compliance with all of the provisions and conditions of Rule 144 promulgated
under the Act as if such Rule were applicable.
2.7 The Purchaser consents that the Company may, if it desires, permit
the transfer of the Shares received out of the Purchaser's name only when the
Purchaser's request for transfer is accompanied by an opinion of counsel
reasonably satisfactory to the Company that neither the sale nor the proposed
transfer results in a violation of the Act or any applicable state "blue sky"
laws (collectively "Securities Laws").
2.8 The Purchaser agrees to hold the Company and its directors, officers
and controlling persons and their respective heirs, representatives,
successors and assigns harmless and to indemnify them against all
liabilities, costs and expenses incurred by them as a result of any
misrepresentation made by him contained herein or in the Confidential
Purchaser Questionnaire or any sale or distribution by the undersigned
Purchaser in violation of any Securities Laws.
2.9 The Purchaser consents to such restrictions on transferability and
sale of the Shares as may be requested by a managing underwriter in
connection with an initial public offering of the Company's equity securities
(an "IPO"), which restrictions may include, by way of example, a twelve month
lock-up period following consummation of an initial public offering.
2.10 The Purchaser consents to the placement of a legend on
any certificate or other document evidencing the Shares stating that they
have not been registered under the Act and setting forth or referring to the
restrictions on transferability and sale thereof. The Purchaser is aware
that the Company will make a notation in its records with respect to the
restrictions on the transferability of such securities.
III. REPRESENTATIONS BY THE COMPANY
3.1 The Company represents and warrants to the Purchaser that prior to
the consummation of this purchase and at such date:
(a) The Company is a corporation duly organized, existing and in
good standing under the laws of the State of Delaware and has the corporate
power to conduct the business which it conducts and proposes to conduct.
(b) The execution, delivery and performance of this Agreement by
the Company will have been duly approved by the Board of Directors of the
Company and all other actions required to authorize and effect the sale of
the Shares will have been duly taken and approved.
(c) The Shares have been duly and validly authorized and when
issued and paid for in accordance with the terms hereof, will be validly
issued, fully paid and nonassessable.
(d) The Company has obtained, or is in the process of obtaining,
all licenses, permits and other governmental authorizations necessary to the
conduct of its business; such licenses, permits and other governmental
authorizations obtained are in full force and effect; and the Company is in
all material respects complying therewith.
(e) The Company knows of no pending or threatened legal or
governmental proceedings to which the Company is a party which could
materially adversely affect the business, property, financial condition or
operations of the Company.
(f) The Company is not in violation of or default under, nor will
the execution and delivery of this Agreement, the issuance of the Shares and
the incurrence of the obligations herein and therein set forth and the
consummation of the transactions herein or therein contemplated, result in a
violation of, or constitute a default under, the certificate of incorporation
or by-laws, in the performance or observance of any material obligations,
agreement, covenant or condition contained in any bond, debenture, note or
other evidence of indebtedness to which the Company is a party or by which it
or any of its properties may be bound or in violation of any material order,
rule, regulations writ, injunction, or decree of any government, governmental
instrumentality or court, domestic or foreign. The Company represents that
presently it does
not have a sufficient number of authorized but unissued shares of common
stock available for the issuance of the Shares contemplated hereby. The
Company agrees to use its best efforts to cause the Charter Amendment to
become effective.
IV. MISCELLANEOUS
4.1 Any notice or other communication given hereunder shall be deemed
sufficient if in writing and sent by registered or certified mail, return
receipt requested, addressed to the Company, at its registered office, 0000
X. Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx, Xxxxxxxxxx, 00000, Attention: Xxxxx
Xxxxxx, M.D., CEO, and to the Purchaser at the address set forth on the
signature page hereto. Notices shall be deemed to have been given on the
date of mailing, except notices of change of address, which shall be deemed
to have been given when received.
4.2 This Agreement shall not be changed, modified or amended except by a
writing signed by the parties to be charged, and this Agreement may not be
discharged except by performance in accordance with its terms or by a writing
signed by the party to be charged.
4.3 This Agreement shall be binding upon and inure to the benefit of the
parties hereto and to their respective heirs, legal representatives,
successors and assigns. This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter thereof and merges
and supersedes all prior discussions, agreements and understandings of any
and every nature among them.
4.4 Notwithstanding the place where this Agreement may be executed by
any of the parties hereto, the parties expressly agree that all the terms and
provisions hereof shall be construed in accordance with and governed by the
laws of the State of New York. The parties hereby agree that any dispute
which may arise between them arising out of or in connection with this
Agreement shall be adjudicated before a court located in New York City and
they hereby submit to the exclusive jurisdiction of the courts of the State
of New York located in New York, New York and of the federal courts in the
Southern District of New York with respect to any action or legal proceeding
commenced by any party, and irrevocably waive any objection they now or
hereafter may have respecting the venue of any such action or proceeding
brought in such a court or respecting the fact that such court is an
inconvenient forum, relating to or arising out of this Agreement or any acts
or omissions relating to the sale of the securities hereunder, and consent to
the service of process in any such action or legal proceeding by means of
registered or certified mail, return receipt requested, in care of the
address set forth below or such other address as the undersigned shall
furnish in writing to the other.
4.5 This Agreement may be executed in counterparts. Upon the execution
and delivery of this Agreement by the Purchaser, this Agreement shall become
a binding obligation of the Purchaser with respect to the purchase of the
Shares as herein provided.
4.6 The holding of any provision of this Agreement to be invalid or
unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Agreement, which shall remain in full force and effect.
4.7 It is agreed that a waiver by either party of a breach of any
provision of this Agreement shall not operate, or be construed, as a waiver
of any subsequent breach by that same party.
4.8 The parties agree to execute and deliver all such further documents,
agreements and instruments and take such other and further action as may be
necessary or appropriate to carry out the purposes and intent of this
Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first written above.
AYURCORE, INC.
By: /s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx, M.D.,
Chief Executive Officer
/s/ Xxxx Xxxxxxx
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Xxxx Xxxxxxx
Address:
Number of Shares
Being Purchased: 154,967
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Total Principal and
Interest Being
Canceled: $619,868
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