SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of December 3,
2001, by and between Senesco Technologies, Inc., a Delaware corporation (the
"Company"), and [ ] (the "Purchaser").
W I T N E S S E T H :
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WHEREAS, the Company issued certain promissory notes payable to the
Purchaser in the aggregate principal amount of $[ ] (the "Notes"), and in
connection with such Notes, the Purchaser has executed a letter agreement
providing that the entire principal amount outstanding under the Notes, plus any
interest which has accrued as of the date hereof, shall be converted into shares
of the Company's restricted common stock, $0.01 par value per share (the "Common
Stock") and warrants to purchase shares of Common Stock (the "Warrants") as of
the date hereof, on the same terms as provided in the Securities Purchase
Agreement dated November 30, 2001, made by and between the Company and Stanford
Venture Capital Holdings, Inc.; and
WHEREAS, the Purchaser desires to convert the Notes into the Company's
Common Stock and Warrants and the Company desires to sell, transfer and assign
to the Purchaser, and the Purchaser desires to purchase from the Company, [ ]
shares (the "Shares") of the Company's Common Stock, and Warrants to purchase
[ ] shares of Common Stock, for an aggregate purchase price of $[ ], which
reflects the entire principal amount outstanding under the Notes, plus $[ ] of
interest which has accrued as of the date hereof (the Warrants, together with
the Shares, shall be referred to herein as the "Securities");
NOW, THEREFORE, in consideration of the promises and the mutual covenants
contained herein, the parties hereto, intending to be legally bound, hereby
agree as follows:
SECTION I
PURCHASE, SALE AND REGISTRATION OF THE SECURITIES
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A. Purchase and Sale. Subject to the terms and conditions of this Agreement
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and on the basis of the representations, warranties, covenants and agreements
herein contained, the Company hereby agrees to sell, transfer, assign and convey
the Securities to the Purchaser, and the Purchaser agrees to purchase, acquire
and accept the Securities from the Company.
B. Purchase Price. The Securities are hereby offered at a price of $1.75
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per unit, equal to one share of Common Stock and a Warrant to purchase 0.875
shares of Common Stock. The aggregate purchase price for the Securities to be
paid by the Purchaser to the Company is $[ ] (the "Aggregate Purchase Price").
The Aggregate Purchase Price shall be paid by the Purchaser to the Company on
the Closing Date by cancellation of the original Notes. The parties to this
Agreement agree that, as soon as reasonably practicable after the date hereof,
they shall allocate, in good faith, the purchase price between the Shares and
Warrants so purchased.
C. Warrants. Fifty percent (50%) of the Warrants shall have an exercise
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price of $2.00 per Share and fifty percent (50%) of the Warrants shall have an
exercise price of $3.25 per Share and shall have the terms set forth in the form
of Warrant attached hereto as Exhibit A, which shall each be executed by the
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Company on the Closing Date.
D. Registration Rights Agreement. On the Closing Date, the Company and the
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Purchaser shall enter into a Registration Rights Agreement in the form attached
hereto as Exhibit B (the "Registration Rights Agreement").
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SECTION II
REPRESENTATIONS, WARRANTIES, COVENANTS
AND AGREEMENTS OF THE COMPANY
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The Company represents and warrants to, and covenants and agrees with, the
Purchaser, as of the date hereof and as of the Closing Date, that:
A. Organization, Good Standing and Power. The Company is a corporation duly
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incorporated, validly existing and in good standing under the laws of the State
of Delaware and has the requisite corporate power to own, lease and operate its
properties and assets and to conduct its business as it is now being conducted.
The Company does not have any subsidiaries (as defined in Section II(G)), except
as set forth in the reports, schedules, forms, statements and other documents
required to be filed by the Company and its predecessors with the Securities and
Exchange Commission (the "Commission"), pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), including material filed pursuant to
Section 13(a) or 15(d) of the Exchange Act (all of the foregoing, including
filings incorporated by reference therein, being referred to herein as the
"Commission Documents"). The Company and each such subsidiary is duly
incorporated or duly qualified as a foreign Company to do business and is in
good standing in every jurisdiction of the United States, or any other country,
state, province, or political subdivision in which the nature of the business
conducted or property owned by it makes such qualification necessary except for
any jurisdiction in which the failure to be so qualified will not have a
Material Adverse Effect on the Company's financial condition. For purposes of
this Agreement, "Material Adverse Effect" shall mean any effect on the business,
operations, properties or financial condition of the Company that is material
and adverse to the Company and its subsidiaries, taken as a whole and/or any
condition, circumstance, or situation that would prohibit the ability of the
Company to enter into and perform any of its obligations under this Agreement,
the Warrant or the Registration Rights Agreement.
B. Authorization; Enforcement. The Company has the corporate power and
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authority to enter into and perform this Agreement, the Warrant and the
Registration Rights Agreement, and to issue and sell the Shares and the Warrants
in accordance with the terms hereof and thereof. The execution, delivery and
performance of this Agreement, the Warrant and the Registration Rights Agreement
by the Company and the consummation by it of the transactions contemplated
hereby and thereby have been duly and validly authorized by all necessary
corporate action, and no further consent or authorization of the Company or its
Board of Directors or stockholders is required. Each of this Agreement, the
Warrant and the Registration Rights Agreement has been duly executed and
delivered by the Company. Each of this Agreement, the Warrant and the
Registration Rights Agreement constitutes, or shall constitute when executed and
delivered, a valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation, conservatorship, receivership or similar laws relating to, or
affecting generally the enforcement of, creditor's rights and remedies or by
other equitable principles of general application.
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C. Capitalization. The authorized capital stock of the Company and the
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shares thereof issued and outstanding as of the date hereof, including all
options to acquire shares of capital stock issued as of the date hereof, are set
forth in the Company's Proxy Statement for its 2001 Annual Meeting. All of the
outstanding shares of the Company's capital stock have been duly and validly
authorized. Except as set forth in this Agreement, the Warrant, the Registration
Rights Agreement or the Commission Documents, no shares of Common Stock are
entitled, from the Company, to preemptive rights or registration rights and
there are no outstanding options, warrants, scrip, rights to subscribe to, call
or commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company. Furthermore,
except as set forth in this Agreement, the Warrant, the Registration Rights
Agreement or the Commission Documents, there are no contracts, commitments,
understandings, or arrangements by which the Company is or may become bound to
issue additional shares of the capital stock of the Company or options,
securities or rights convertible into shares of capital stock of the Company.
Except for customary transfer restrictions contained in agreements entered into
by the Company in order to sell restricted securities or as provided in the
Commission Documents, the Company is not a party to any agreement granting
registration rights to any person with respect to any of its equity or debt
securities. Except as set forth in the Commission Documents, the offer and sale
of all capital stock, convertible securities, rights, warrants, or options of
the Company issued prior to the date hereof complied with all applicable federal
and state securities laws, and no stockholder has a right of rescission or
damages with respect thereto which would have a Material Adverse Effect. The
Company has filed as exhibits to the Commission Documents true and correct
copies of the Company's Certificate of Incorporation as in effect on the date
hereof (the "Certificate"), and the Company's Bylaws as in effect on the date
hereof (the "Bylaws").
D. Issuance of Shares. The Shares to be issued under this Agreement and the
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shares of Common Stock to be issued under each Warrant (the "Warrant Shares"),
have been duly authorized by all necessary corporate action and, when paid for
or issued in accordance with the terms hereof and thereof, the Securities and
the Warrant Shares shall be validly issued and outstanding, fully paid and
nonassessable, free and clear of all liens, charges, and encumbrances of any
nature whatsoever, except for restrictions on transfer that may exist under
applicable securities laws, and the Purchaser shall be entitled to all rights
accorded to a holder of Common Stock.
E. No Conflicts. The execution, delivery and performance of this Agreement,
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the Warrant and the Registration Rights Agreement by the Company and the
consummation by the Company of the transactions contemplated herein and therein
do not (i) violate any provision of the Certificate or Bylaws, (ii) conflict
with, or constitute a default (or an event which with notice or lapse of time or
both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any material agreement, mortgage,
deed of trust, indenture, note, bond, license, lease agreement, instrument or
obligation to which the Company is a party, (iii) create or impose a lien,
charge or encumbrance on any property of the Company under any agreement or any
commitment to which the Company is a party or by which the Company is bound or
by which any of its respective properties or assets are bound, or (iv) result in
a violation of any federal, state, local or foreign statute, rule, regulation,
order, judgment or decree (including federal and state securities laws and
regulations) applicable to the Company or any of its subsidiaries or by which
any property or asset of the Company or any of its
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subsidiaries are bound or affected, and except, in all cases, for such
conflicts, defaults, terminations, amendments, acceleration, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect. The Company is not required under federal, state or local law,
rule or regulation to obtain any consent, authorization or order of, or make any
filing or registration with, any court or governmental agency in order for it to
execute, deliver or perform any of its obligations under this Agreement, the
Warrant and the Registration Rights Agreement, or issue and sell the Shares and
the Warrants in accordance with the terms hereof (other than any filings which
may be required to be made by the Company with the Commission, the National
Association of Securities Dealers, Inc. (the "NASD"), or state securities
administrators subsequent or prior to the Closing Date hereunder, and, any
registration statement which may be filed pursuant hereto); provided that, for
purpose of the representation made in this sentence, the Company is assuming and
relying upon the accuracy of the relevant representations and agreements of the
Purchaser.
F. Commission Documents; Financial Statements. The Common Stock of the
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Company is registered pursuant to Section 12(b) or 12(g) of the Exchange Act,
and, except as disclosed in the Commission Documents, since January 1999, the
Company has timely filed all Commission Documents. The Company has made
available to the Purchaser true and complete copies of the Commission Documents
filed with the Commission as set forth in Section III(G) hereof. The Company has
not provided to the Purchaser any information which, according to applicable
law, rule or regulation, should have been disclosed publicly by the Company but
which has not been so disclosed, or for which the Purchaser has not executed a
confidentiality agreement, other than with respect to the transactions
contemplated by this Agreement. As of their respective dates, the Form 10-KSB
for the fiscal year ended June 30, 2001 and the Form l0-QSB for the fiscal
quarter ended September 30, 2001 complied in all material respects with the
requirements of the Exchange Act and the rules and regulations of the Commission
promulgated thereunder and, as of their respective dates, none of the Form
l0-KSB and the Form l0-QSB referred to above contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The financial
statements of the Company included in the Commission Documents comply as to form
in all material respects with applicable accounting requirements and the
published rules and regulations of the Commission or other applicable rules and
regulations with respect thereto. Such financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") applied on
a consistent basis during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto or (ii) in the case
of unaudited interim statements, to the extent they may not include footnotes or
may be condensed or summary statements), and fairly present in all material
respects the financial position of the Company and its subsidiaries as of the
dates thereof and the results of operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments).
G. Subsidiaries. The Company's Form 10-KSB for the fiscal year ended June
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30, 2001 sets forth each subsidiary of the Company, showing the jurisdiction of
its incorporation or organization and showing the percentage of each person's
ownership of the outstanding capital stock or other interests of such
subsidiary. For the purposes of this Agreement, "subsidiary" shall mean any
Company or other entity of which at least 50% of the securities or other
ownership interest having ordinary voting power (absolutely or contingently) for
the election of directors or
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other persons performing similar functions are at the time owned directly or
indirectly by the Company and/or any of its other subsidiaries. Except as set
forth in the Commission Documents, none of such subsidiaries is a "significant
subsidiary" as defined in Regulation S-X.
H. No Material Adverse Change. Since September 30, 2001, the date through
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which the most recent quarterly report of the Company on Form l0-QSB has been
filed with the Commission, a copy of which is included in the Commission
Documents, the Company has not experienced or suffered any Material Adverse
Effect.
I. No Undisclosed Liabilities. Except as disclosed in the Commission
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Documents, neither the Company nor any of its subsidiaries has any liabilities,
obligations, claims or losses (whether liquidated or unliquidated, secured or
unsecured, absolute, accrued, contingent or otherwise) that would be required to
be disclosed on a balance sheet of the Company or any subsidiary (including the
notes thereto) in conformity with GAAP not disclosed in the Commission
Documents, other than those incurred in the ordinary course of the Company's or
its subsidiaries respective businesses since June 30, 2001 and which,
individually or in the aggregate, do not or would not have a Material Adverse
Effect on the Company or its subsidiaries.
J. No Undisclosed Events or Circumstances. Except for the transactions and
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with respect to the Company or its subsidiaries or their respective businesses,
properties, prospects, operations or financial condition, which, under
applicable law, rule or regulation, requires public disclosure or announcement
by the Company but which has not been so publicly announced or disclosed.
K. Indebtedness. The Company's Form 10-QSB for the period ended September
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30, 2001 sets forth, as of the date hereof, all outstanding secured and
unsecured Indebtedness of the Company or any subsidiary, or for which the
Company or any subsidiary has commitments. For the purposes of this Agreement,
"Indebtedness" shall mean (a) any liabilities for borrowed money or amounts owed
in excess of $25,000 (other than trade accounts payable incurred in the ordinary
course of business), (b) all guaranties, endorsements and other contingent
obligations in respect of Indebtedness of others, whether or not the same are or
should be reflected in the Company's balance sheet (or the notes thereto),
except guaranties by endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business; and (c)
the present value of any lease payments in excess of $25,000 due under leases
required to be capitalized in accordance with GAAP. Neither the Company nor any
subsidiary is in default with respect to any Indebtedness.
L. Title to Assets. Each of the Company and the subsidiaries has good and
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marketable title to all of its real and personal property reflected in the
Company's Form 10-KSB for the fiscal year ended June 30, 2001, free of any
mortgages, pledges, charges, liens, security interests or other encumbrances,
except for those indicated in the Commission Documents or such that could not
reasonably be expected to cause a Material Adverse Effect on the Company's
financial condition or operating results. All said leases of the Company and
each of its subsidiaries are valid and subsisting and in full force and effect
in all material respects.
M. Actions Pending. There is no action, suit, claim, investigation or
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Company or any subsidiary which questions the validity of this Agreement, the
Warrant or the Registration Rights
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Agreement, or the transactions contemplated hereby or thereby, or any action
taken or to be taken pursuant hereto or thereto. There is no action, suit,
claim, investigation or proceeding pending or, to the knowledge of the Company,
threatened, against or involving the Company, any subsidiary or any of their
respective properties or assets and which, if adversely determined, is
reasonably likely to result in a Material Adverse Effect. To the knowledge of
the Company, there are no outstanding orders, judgments, injunctions, awards or
decrees of any court, arbitrator or governmental or regulatory body against the
Company or any subsidiary.
N. Compliance with Law. The business of the Company and the subsidiaries
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has been and is presently being conducted in accordance with all applicable
federal, state and local governmental laws, rules, regulations and ordinances,
except as set forth in the Company's most recent Form 10-KSB and Form 10-QSB or
except where such failure would not cause a Material Adverse Effect. The Company
and each of its subsidiaries have all franchises, permits, licenses, consents
and other governmental or regulatory authorizations and approvals necessary for
the conduct of its business as now being conducted by it unless the failure to
possess such franchises, permits, licenses, consents and other governmental or
regulatory authorizations and approvals, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect. To the knowledge
of the Company, the Company's technology does not require the premarket approval
of the United States Food and Drug Administration (the "FDA") or the approval of
or any filing with the FDA or the United States Environmental Protection Agency
(the "EPA") under current rules and regulations of the FDA and EPA,
respectively, when used for their intended use.
O. Certain Fees. Except as otherwise provided herein, no brokers, finders
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or financial advisory fees or commissions will be payable by the Company or any
subsidiary with respect to the transactions contemplated by this Agreement.
P. Disclosure. Neither this Agreement or the Exhibits hereto nor any other
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documents, certificates or instruments furnished to the Purchaser by or on
behalf of the Company or any subsidiary in connection with the transactions
contemplated by this Agreement contain any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements made
herein or therein, in the light of the circumstances under which they were made
herein or therein, not misleading.
Q. Intellectual Property; Operation of Business. The Company and each of
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the subsidiaries owns or possesses all patents, trademarks, service marks, trade
names, copyrights, licenses and authorizations as set forth in the Company's
Form 10-KSB for the year ended June 30, 2001 and all rights with respect to the
foregoing, which are necessary for the conduct of its business as now conducted
without any conflict with the rights of others, except to the extent that a
Material Adverse Effect could not reasonably be expected to result from such
conflict. The Company currently owns or possesses adequate rights to use all
inventions subject to pending patent applications and all licenses, copyrights,
inventions, know-how, trade secrets, proprietary technologies, including
trademarks, service marks, trade names, processes and substances described in
the Company's Form 10-KSB for the year ended June 30, 2001 including, without
limitation, the inventions underlying, and the trade names for, the Company's
technology; and the Company is not aware of the granting of any patent rights
to, or the filing of applications therefor by, others, nor is the Company aware
of, or has the Company received notice of, infringement of
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or conflict with asserted rights of others with respect to any of the foregoing.
All such licenses, trademarks, service marks, trade names and copyrights are (i)
valid and enforceable and (ii) to the best knowledge of the Company, not being
infringed upon by any third parties. To the knowledge of the Company, none of
the inventions described and claimed in the pending patent applications
disclosed in the Commission Documents and filed on behalf of original inventors
with respect to the inventions underlying the Company's technology has been
described or suggested in either the relevant patent literature or the relevant
scientific literature. To the knowledge of the Company, said inventions are
patentable and no other patent is infringed upon by the subject matter of said
inventions. All pertinent prior art references were disclosed to the United
States Patent and Trademark Office (the "PTO") in the pending patent
applications and all information submitted to the PTO in respect thereof was
accurate. The Company has not made any representation or concealed any material
fact from the PTO.
R. Environmental Compliance. The Company and each of its subsidiaries have
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obtained all material approvals, authorization, certificates, consents,
licenses, orders and permits or other similar authorizations of all governmental
authorities, or from any other person, that are required under any Environmental
Laws, except where the failure to obtain such authorizations would not have a
Material Adverse Effect. For purposes of this Agreement, "Environmental Laws"
shall mean all applicable laws relating to the protection of the environment
including, without limitation, all requirements pertaining to reporting,
licensing, permitting, controlling, investigating or remediating emissions,
discharges, releases or threatened releases of hazardous substances, chemical
substances, pollutants, contaminants or toxic substances, materials or wastes,
whether solid, liquid or gaseous in nature, into the air, surface water,
groundwater or land, or relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of hazardous
substances, chemical substances, pollutants, contaminants or toxic substances,
material or wastes, whether solid, liquid or gaseous in nature. Except for such
instances as would not individually or in the aggregate have a Material Adverse
Effect, there are no past or present events, conditions, circumstances,
incidents, actions or omissions relating to or in any way affecting the Company
or its subsidiaries that violate or would reasonably be expected to violate any
Environmental Law after the Closing Date hereunder or that would reasonably be
expected to give rise to any environmental liability, or otherwise form the
basis of any claim, action, demand, suit, proceeding, hearing, study or
investigation (i) under any Environmental Law, or (ii) based on or related to
the manufacture, processing, distribution, use, treatment, storage (including
without limitation underground storage tanks), disposal, transport or handling,
or the emission, discharge, release or threatened release of any hazardous
substance.
S. Material Agreements. Except as set forth in the Commission Documents,
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neither the Company nor any subsidiary is a party to any written or oral
contract, instrument, agreement, commitment, obligation, plan or arrangement, a
copy of which would be required to be filed with the Commission as an exhibit to
a registration statement on Form S-3 or applicable form (collectively, "Material
Agreements") if the Company or any subsidiary were registering securities under
the Securities Act of 1933, as amended, (the "Securities Act"), which has not
been previously filed as an exhibit to the Commission Documents. The Company and
each of its subsidiaries has in all material respects performed all the
obligations required to be performed by them to date under the foregoing
agreements, have received no notice of default and, to the best of the Company's
knowledge, are not in default under any Material Agreement now in effect, the
result of which would reasonably be expected to cause a Material Adverse Effect.
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T. Transactions with Affiliates. Except as set forth in the Commission
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Documents, there are no loans, leases, agreements, contracts, royalty
agreements, management contracts or arrangements or other continuing
transactions with aggregate obligations of any party exceeding $25,000 between
(a) the Company, any subsidiary or any of their respective customers or
suppliers on the one hand, and (b) on the other hand, any person who would be
covered by Item 404(a) of Regulation S-K or any company or other entity
controlled by such stockholder, officer, employee, consultant, director or
person.
U. Securities Act. The Company has complied with all applicable federal and
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state securities laws in connection with the offer, issuance and sale of the
Securities hereunder and the Warrant Shares pursuant to the Warrant. Neither the
Company nor anyone acting on its behalf, directly or indirectly, has sold,
offered to sell or solicited offers to buy the Shares, the Warrants or similar
securities to, or solicit offers with respect thereto from, or enter into any
preliminary conversations or negotiations relating thereto with, any person, so
as to bring the issuance and sale of the Shares under the registration
provisions of the Securities Act and applicable state securities laws. Neither
the Company nor, to the knowledge of the Company, any of its affiliates, nor any
person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) in connection with the offer or sale of the Shares or the
Warrants.
V. Employees. Neither the Company nor any subsidiary has any collective
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bargaining arrangements or agreements covering any of its employees, except as
set forth in the Commission Documents. Except as set forth in the Commission
Documents, neither the Company nor any subsidiary has any employment contract,
agreement regarding proprietary information, noncompetition agreement,
nonsolicitation agreement, confidentiality agreement, or any other similar
contract or restrictive covenant, relating to the right of any officer, employee
or consultant to be employed or engaged by the Company or such subsidiary. Since
June 30, 2001, except as disclosed in Commission Documents, no officer,
consultant or key employee of the Company or any subsidiary whose termination,
either individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect, has terminated or, to the knowledge of the Company, has
any present intention of terminating his or her employment or engagement with
the Company or any subsidiary.
W. Public Utility Holding Company Act and Investment Company Act Status.
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The Company is not a "holding company" or a "public utility company" as such
terms are defined in the Public Utility Holding Company Act of 1935, as amended.
The Company is not, and as a result of and immediately upon the Closing Date
will not be, an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.
X. ERISA. No liability to the Pension Benefit Guaranty Company has been
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incurred with respect to any Plan by the Company or any of its subsidiaries
which is or would be materially adverse to the Company and its subsidiaries. The
execution and delivery of this Agreement, the Warrant and the Registration
Rights Agreement, and the issue and sale of the Shares and the Warrants, will
not involve any transaction which is subject to the prohibitions of Section 406
of ERISA or in connection with which a tax could be imposed pursuant to Section
4975 of the Internal Revenue Code of 1986, as amended (the "Code"), provided
that, if the
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Purchaser, or any person or entity that owns a beneficial interest in the
Purchaser, is an "employee pension benefit plan" (within the meaning of Section
3(2) of ERISA) with respect to which the Company is a "party in interest"
(within the meaning of Section 3(14) of ERISA), the requirements of Sections
407(d) (5) and 408(e) of ERISA, if applicable, are met. As used in this
paragraph, the term "Plan" shall mean an "employee pension benefit plan" (as
defined in Section 3 of ERISA) which is or has been established or maintained,
or to which contributions are or have been made, by the Company or any
subsidiary or by any trade or business, whether or not incorporated, which,
together with the Company or any subsidiary, is under common control, as
described in Section 414(b) or (c) of the Code.
Y. Taxes. The Company and each of the subsidiaries has accurately prepared
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and filed all federal, state, local, foreign and other tax returns for income,
gross receipts, sales, use and other taxes and custom duties ("Taxes") required
by law to be filed by it, has paid or made provisions for the payment of all
taxes shown to be due and all additional assessments, and adequate provisions
have been and are reflected in the financial statements of the Company and the
subsidiaries for all current taxes and other charges to which the Company or any
subsidiary is subject and which are not currently due and payable, except for
taxes, if unpaid, individually or in the aggregate, do not and would not have a
Material Adverse Effect on the Company or its subsidiaries. None of the federal
income tax returns of the Company or any subsidiary for the last five (5) years
has been audited by the Internal Revenue Service. The Company has no knowledge
of any additional assessments, adjustments or contingent tax liability (whether
federal, state, local or foreign) pending or threatened against the Company or
any subsidiary or any person for whose tax liabilities the Company is or may be
jointly or contingently liable for any period, nor of any basis for any such
assessment, adjustment or contingency.
Z. Books and Records; Internal Accounting Controls. The records and
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documents of the Company and its subsidiaries accurately reflect in all material
respects the information relating to the business of the Company and the
subsidiaries, the location and collection of their assets, and the nature of all
transactions giving rise to the obligations or accounts receivable of the
Company or any subsidiary.
AA. Survival. All representations, warranties, covenants and agreements
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made by the Company in this Agreement or in any writing or certificate delivered
in connection with this Agreement shall survive the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby for
a period of one (1) year, except that any representations and warranties related
to taxes shall survive for three (3) years.
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SECTION III
REPRESENTATIONS, WARRANTIES, COVENANTS
AND AGREEMENTS OF THE PURCHASER
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The Purchaser represents and warrants to, and covenants and agrees with,
the Company, as of the date hereof and as of the Closing Date, that:
A. Organization; Good Standing (if applicable). The Purchaser is, and as of
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the Closing will be, duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization.
B. Authorization. The Purchaser has, and as of the Closing will have, all
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requisite power and authority to execute, deliver and perform this Agreement and
to consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, have been duly and validly authorized by all necessary
action on the part of the Purchaser. This Agreement has been duly executed and
delivered by the Purchaser and constitutes its legal, valid and binding
obligation, enforceable against the Purchaser in accordance with its terms,
except as the enforceability thereof may be limited by bankruptcy, insolvency or
other similar laws affecting the enforceability of creditors' rights in general
or by general principles of equity.
C. No Legal Bar; Conflicts. Neither the execution and delivery of this
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Agreement, nor the consummation by the Purchaser of the transactions
contemplated hereby, violates any law, statute, ordinance, regulation, order,
judgment or decree of any court or governmental agency applicable to the
Purchaser, or violates, or conflicts with, any contract, commitment, agreement,
understanding or arrangement of any kind to which the Purchaser is a party or by
which the Purchaser is bound.
D. No Litigation. No action, suit or proceeding against the Purchaser
--------------
relating to the consummation of any of the transactions contemplated by this
Agreement nor any governmental action against the Purchaser seeking to delay or
enjoin any such transactions is pending or, to the Purchaser's knowledge,
threatened.
E. Investment Intent. The Purchaser: (i) is an accredited investor within
-----------------
the meaning of Rule 501(a) under the Securities Act; (ii) is aware of the limits
on resale imposed by virtue of the nature of the transactions contemplated by
this Agreement, specifically the restrictions imposed by Rule 144 of the Act,
and is aware that the certificates representing the Purchaser's respective
ownership of the Securities will bear related restrictive legends; and (iii)
except as otherwise set forth herein, is acquiring the Securities hereunder
without registration under the Act in reliance on the exemption from
registration contained in Section 4(2) of the Act and/or Rule 506 promulgated
pursuant to Regulation D of the Act, for investment for its own account, and not
with a view toward, or for sale in connection with, any distribution thereof,
nor with any present intention of distributing or selling such Securities. The
Purchaser has been given the opportunity to ask questions of, and receive
answers from, the officers of the Company regarding the Company, its current and
proposed business operations and the Securities, and the officers of the Company
have made available to the Purchaser all documents and information that the
Purchaser has requested relating to an investment in the Company. The Purchaser
has been given the
-10-
opportunity to retain competent legal counsel in connection with the purchase of
the Securities and acknowledges that the Company has relied upon the Purchaser's
representations in this Section III in offering and selling the Securities to
the Purchaser.
F. Economic Risk; Restricted Securities. The Purchaser recognizes that the
------------------------------------
investment in the Securities involves a number of significant risks. The
foregoing, however, does not limit or modify the representations, warranties and
agreements of the Company in Section II of this Agreement or the right of the
Purchaser to rely thereon. The Purchaser is able to bear the economic risks of
an investment in the Securities for an indefinite period of time, has no need
for liquidity in such investment and, at the present time, can afford a complete
loss of such investment.
G. Access to Information.
---------------------
(i) The Purchaser has received and reviewed a copy of the following
documents of the Company:
1. Private Placement Memorandum dated November 1, 2001;
2. Annual Report on Form 10-KSB for the year ended June 30, 2001;
3. Definitive Proxy Statement for the 2001 Annual Meeting of
Stockholders;
4. Quarterly Report on Form 10-QSB for the quarter ended September
30, 2001; and
5. Any press releases issued after the Company's most recently filed
Form 10-QSB.
(ii) The Purchaser represents that it has received the documents set
forth above, and has had the opportunity to ask questions of, and receive
answers from, the Company regarding the foregoing documents.
H. Suitability. The Purchaser has carefully considered, and has, to the
-----------
extent the Purchaser deems it necessary, discussed with the Purchaser's own
professional legal, tax and financial advisers the suitability of an investment
in the Securities for the Purchaser's particular tax and financial situation,
and the Purchaser has determined that the Securities is a suitable investment.
I. Legend. The Purchaser acknowledges that the certificates evidencing the
------
Securities will bear the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). THE SHARES HAVE BEEN ACQUIRED
FOR INVESTMENT AND MAY NOT BE PLEDGED, HYPOTHECATED,
SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SHARES UNDER SUCH ACT
OR AN OPINION OF COUNSEL TO THE ISSUER THAT
REGISTRATION IS NOT REQUIRED UNDER THE ACT.
-11-
SECTION IV
THE CLOSING AND CONDITIONS TO CLOSING
-------------------------------------
A. Time and Place of the Closing. The closing shall be held at the offices
-----------------------------
of Xxxx and Xxxx LLP, 000 Xxxxxxx Xxxx Xxxx, Xxxxxxxxx, Xxx Xxxxxx 00000, on
December 3, 2001 (the "Closing Date"), or such other time and place as the
Company and the Purchaser may mutually agree.
B. Delivery by the Company. Delivery of the Securities shall be made by the
-----------------------
Company, or by its transfer agent, as applicable, to the Purchaser as soon as
reasonably practicable after the Closing Date by delivering certificates
representing the Securities, such certificate to be accompanied by any requisite
documentary or transfer tax stamps.
C. Delivery by the Purchaser. On the Closing Date, the Purchaser shall
--------------------------
deliver to the Company the Aggregate Purchase Price, by delivering the canceled
original Notes to the Company.
D. Registration Rights Agreement. The Company shall deliver to the
--------------------------------
Purchaser, and the Purchaser shall deliver to the Company, an executed copy of
the Registration Rights Agreement.
E. Warrant. The Company shall execute and deliver to the Purchaser the
-------
Warrant.
F. Other Conditions to Closing. As of the Closing Date, all requisite
-----------------------------
action by the Company's Board of Directors and stockholders shall have been
taken pursuant to the Certificate of Incorporation and By-Laws of the Company,
and the representations and warranties made by the Company in Section II hereof
shall be true and correct when made and as of the Closing Date.
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SECTION V
INDEMNIFICATION
---------------
A. General Indemnity. The Company agrees to indemnify and hold harmless the
-----------------
Purchaser and its agents, heirs, successors and assigns (but excluding
consequential damages) from and against any and all actual losses, liabilities,
deficiencies, costs, damages and reasonable expenses (including, without
limitation, reasonable attorney's fees, charges and disbursements) incurred as a
result of any misrepresentation or breach of the warranties and covenants made
by the Company herein, in the Warrant and the Registration Rights Agreement,
except where such misrepresentation or breach is caused by the Purchaser. The
Purchaser agrees to indemnify and hold harmless the Company and its directors,
officers, affiliates, agents, successors and assigns from and against any and
all actual losses, liabilities, deficiencies, costs, damages and expenses
(including, without limitation, reasonable attorneys fees, charges and
disbursements but excluding consequential damages) incurred by the Company as
result of any breach of the representations and covenants made by the Purchaser
herein, in the Warrant and the Registration Rights Agreement, except where such
misrepresentation or breach is caused by the Company.
B. Indemnification Procedure. Any party entitled to indemnification under
--------------------------
this Section (an "indemnified party") will give written notice to the
indemnifying party of any matters giving rise to a claim for indemnification;
provided, that the failure of any party entitled to indemnification hereunder to
give notice as provided herein shall not relieve the indemnifying party of its
obligations under this Section except to the extent that the indemnifying party
is actually prejudiced by such failure to give notice. In case any action,
proceeding or claim is brought against an indemnified party in respect of which
indemnification is sought hereunder, the indemnifying party shall be entitled to
participate in and, unless in the reasonable judgment of the indemnified party a
conflict of interest between it and the indemnifying party may exist with
respect of such action, proceeding or claim, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. In the event that the
indemnifying party advises an indemnified party that it will contest such a
claim for indemnification hereunder, or fails, within thirty (30) days of
receipt of any indemnification notice to notify, in writing, such person of its
election to defend, settle or compromise, at its sole cost and expense, any
action, proceeding or claim (or discontinues its defense at any time after it
commences such defense), then the indemnified party may, at its option, defend,
settle or otherwise compromise or pay such action or claim. In any event, unless
and until the indemnifying party elects in writing to assume and does so assume
the defense of any such claim, proceeding or action, the indemnified party's
costs and expenses arising out of the defense, settlement or compromise of any
such action, claim or proceeding shall be losses subject to indemnification
hereunder. The indemnified party shall cooperate fully with the indemnifying
party in connection with any negotiation or defense of any such action or claim
by the indemnifying party and shall furnish to the indemnifying party all
information reasonably available to the indemnified party which relates to such
action or claim. The indemnifying party shall keep the indemnified party fully
apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. If the indemnifying party elects to defend
any such action or claim, then the indemnified party shall be entitled to
participate in such defense with counsel of its choice at its sole cost and
expense. The indemnifying party shall not be liable for any settlement of any
action, claim or proceeding effected without its prior
-13-
written consent. Notwithstanding anything in this Section to the contrary, the
indemnifying party shall not, without the indemnified party's prior written
consent (which consent shall not be unreasonably withheld), settle or compromise
any claim or consent to entry of any judgment in respect thereof which imposes
any future obligation on the indemnified party or which does not include, as an
unconditional term thereof, the giving by the claimant or the plaintiff to the
indemnified party of a release from all liability in respect of such claim. The
indemnification required by this Section shall be made by periodic payments of
the amount thereof during the course of investigation or defense, as and when
bills are received or expense, loss, damage or liability is incurred, so long as
the indemnified party irrevocably agrees to refund such moneys if it is
ultimately determined by a court of competent jurisdiction that such party was
not entitled to indemnification. The indemnity agreements contained herein shall
be in addition to (a) any cause of action or similar rights of the indemnified
party against the indemnifying party or others, and (b) any liabilities the
indemnifying party may be subject to pursuant to the law.
-14-
SECTION VI
MISCELLANEOUS
-------------
A. Entire Agreement. This Agreement contains the entire agreement between
---------------
the parties hereto with respect to the transactions contemplated hereby, and no
modification hereof shall be effective unless in writing and signed by the party
against which it is sought to be enforced.
B. Invalidity, Etc. If any provision of this Agreement, or the application
-----------------
of any such provision to any person or circumstance, shall be held invalid by a
court of competent jurisdiction, the remainder of this Agreement, or the
application of such provision to persons or circumstances other than those as to
which it is held invalid, shall not be affected thereby.
C. Headings. The headings of this Agreement are for convenience of
--------
reference only and are not part of the substance of this Agreement.
D. Binding Effect. This Agreement shall be binding upon and inure to the
---------------
benefit of the parties hereto and their respective successors and assigns.
E. Governing Law. This Agreement shall be governed by and construed in
--------------
accordance with the laws of the State of Delaware applicable in the case of
agreements made and to be performed entirely within such State, without regard
to principles of conflicts of law.
F. Counterparts. This Agreement may be executed in one or more identical
------------
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
* * * * * *
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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the date first above written.
COMPANY:
SENESCO TECHNOLOGIES, INC.
By:
-------------------------------------
Name:
Title:
PURCHASER:
-------------------------------------
[ ]
EXHIBIT A
---------
FORM OF WARRANT
EXHIBIT B
---------
FORM OF REGISTRATION RIGHTS AGREEMENT
Schedule of Parties
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to
--
Securities Purchase Agreements in Connection with the Conversion of Notes by Certain Directors
----------------------------------------------------------------------------------------------
Date of Aggregate Common Stock Warrants
Agreement Director Investment Issued Issued
----------------- ---------------------------- --------------------- --------------------- -------------------
12/03/01 Xxxxxxxxxxx Xxxxxx $356,211 203,549 178,106
12/03/01 Xxxxxx Quick $178,105 101,774 89,053
