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EXHIBIT 4.13
STOCK PURCHASE AGREEMENT
BETWEEN
AMERICAN BIO-TECHNOLOGIES, INC.
AND
THE LOUISIANA SEED CAPITAL FUND, L.P.
JUNE 7, 1991
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STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement ("Agreement") is made and entered into as
of this 7th day of June, 1991, by and between The Louisiana Seed Capital Fund,
L.P., (referred to as "Purchasers"), and American Bio-Technologies, Inc. a
corporation domiciled in Boston, Massachusetts, represented herein by its duly
authorized President, Xxxxx XxXxxxxx (referred to as "Seller"), and concerns
the purchase from Seller for $200,000 of 50,000 shares (the "Common Shares") of
unissued Common Stock of Seller, having no par value per share.
NOW THEREFORE, Purchaser and Seller agree as follows
1. Sale and Purchase of the Common Shares. Subject to the
applicable terms and conditions hereof, and in reliance on the representations
and warranties contained herein, Seller hereby agrees to sell and issue to
Purchaser, and Purchaser hereby agrees to purchase from Seller for $200,000 in
cash (receipt of which is hereby acknowledged by Seller) 50,000 shares of
Common Stock (hereinafter referred to as the "Shares").
2. Purchasers' Representations and Warranties. As an inducement to
Seller to sell and issue the Shares to Purchasers, Purchasers hereby severally,
and not jointly, represent and warrant as follows:
2.1 Authority to Purchase. The execution of this Agreement has been
duly authorized by all necessary action on the part of Purchaser, has been duly
executed and delivered, and constituted a valid, legal, binding and enforceable
agreement of Purchaser, subject to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and applicable securities laws.
2.2 Purchase for Investment. The Purchaser is acquiring its Shares
in good faith for its own account, for investment and not with a view to the
distribution of any shares (as hereinabove defined) or for the purpose of
effecting or causing to be effected a public offering of any Shares in
violation of the Securities Act of 1933, as amended, the "Act") and the rules
promulgated by the Securities and Exchange Commission pursuant to the Act and
the applicable State securities laws and regulations. Purchaser has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of the purchase of its Shares and is able to
bear the economic risk of such purchase. Purchaser recognizes that by reason of
the limitations on disposition of the Shares arising under the Act, Purchaser
must bear the economic risk of its or his investment for an indefinite period
of time as the Shares have not been registered under the Act and, therefore,
cannot be sold unless they are subsequently registered under the Act or an
exemption from such registration requirement is available.
3. Seller's Representations and Warranties. As an inducement to
Purchaser to purchase the Shares, Seller represents and warrants as follows:
3.1 Organization. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the Commonwealth of
Massachusetts, with corporate power and authority to carry on its business as
presently and proposed to be conducted, and each is qualified to do business in
every jurisdiction in which the character and location of the assets owned by
it or the nature of the business transacted and proposed to be transacted by it
or both require qualification and failure to be so qualified would have an
adverse effect on the business or financial condition of Seller. A copy of the
Amended and Restated Articles of Incorporation and Bylaws of the Corporation
are attached hereto as Exhibit 3.1.
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3.2 Authority to Sell. The execution of this Agreement has been duly
authorized by a necessary action on the part of the Seller has been duly
executed and delivered, and constitutes a valid, legal, binding and enforceable
agreement of the Seller, subject to laws of general application relating to
bankruptcy, insolvency, and the relief of debtors and applicable securities
laws.
3.3 Capital Stock. The authorized capital stock of Seller consists of
2,100,000 shares of Common Stock, without par value. The only shares issued are
the 1,840,058 shares of the Common Stock presently outstanding and issued to the
Stockholders listed on Exhibit 3.3 which were validly issued and outstanding,
fully paid and nonassessable. As of the date hereof, no warrants or other rights
convertible into any capital stock of the Seller are outstanding except the
options granted management as described in Exhibit 3.3.
3.4 Financial Statements. Seller has delivered to Purchaser copies of its
unaudited financial statements as of March 31, 1991, and Audited statements as
of June 30, 1990. Copies of which are attached hereto as Exhibit 3.4. These
financial statements are true and correct and have been prepared in accordance
with generally accepted accounting principles consistently applied during the
periods indicated, except as set forth in such financial statements and the
notes thereto, and the balance sheet included in the Financial Statements
presents fairly as of its date the financial condition and assets and
liabilities of the Company. Except as and to the extent reflected or reserved
against in such balance sheet (including the notes thereto), Seller and its
subsidiaries (if any) did not have, as of March 31, 1991 and as of the date
hereof do not have any material liabilities or obligations (absolute or
contingent) of a nature customarily reflected in a balance sheet or notes
thereto prepared in accordance with generally accepted accounting principles.
The statement of income and retained earnings and statement of changes in
financial position included in the Financial Statements present fairly the
results of operations and changes in financial position of Seller and its
subsidiaries, (if any) for the periods indicated.
As of the date of this Agreement and prior to receipt of the purchase price for
the Shares, Seller represents that it has cash in excess of $350.000.
3.5 Absence of Certain Changes. Except as disclosed on Exhibit 3.5, since
the date of the incorporation of Seller, Seller has not:
(a) sold or transferred or agreed to sell or transfer a substantial
part of its assets, property or rights or cancelled or agreed to
cancel any material debts or claims due to it or claimed by it.
(b) entered or agreed to enter into any agreement or arrangement
granting any preferential rights to purchase part of its assets,
property rights;
(c) suffered or been notified of any event which could cause a
material adverse change in its financial condition, assets,
properties or business;
(d) amended or voted to amend its Articles of Incorporation or
By-Laws, except as set forth on Exhibit 3.1; or
(e) declared any dividend (stock or otherwise) or other distribution
of assets payable to its shareholders.
3.6 Litigation and Proceedings. Except as described in the Financial
Statements or Exhibit 3.6 (a list of any such matter not set forth in the
Financial Statements) hereto, or both, there are no actions, suits or
proceedings (whether or not purportedly on behalf of Seller or any of its
subsidiaries, if any) pending or, to the knowledge of Seller, threatened against
or affecting Seller or any of its subsidiaries, at law or in equity or before or
by any governmental department,
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commission, board, bureau, agency or instrumentality, domestic or foreign, or
before any arbitrator of any kind, which are not fully covered by insurance in
excess of a reasonable deductible amount customarily maintained in the line of
business involved which may result in an adverse change in the business,
operations, properties or assets or in the condition, financial or otherwise,
of Seller and its subsidiaries; and neither Seller nor any of its subsidiaries,
if any, is in default on its part with respect to any judgment, order, writ,
injunction or decree of any court, arbitrator, governmental department,
commission, bureau, board, agency or instrumentality.
3.7 No Conflict With Other Instruments. The execution and performance of
this Agreement by Seller will not conflict with or result in a breach of any
term or provision of or constitute a default under any indenture, mortgage,
deed of trust or other agreement or instrument to which Seller is a party or to
which it is subject or by which any of its properties or assets are bound, or
result in the creation of any lien, encumbrance or charge upon any of the
properties or assets of Seller where such conflict, breach, default, lien,
encumbrance or charge would have an adverse effect on the financial condition
of Seller.
3.8 Consents. No authorizations, approvals or consents of any
governmental department, commission, bureau, agency or other public body or
authority are required for the sale or issue of the Shares.
3.9 Approval of Agreement. The execution and delivery of this Agreement
and the sale and issuance of the Shares to Purchaser have been duly and validly
authorized by the Board of Directors of Seller and no approval of the
stockholders of Seller is necessary in connection therewith.
3.10 Private Placement and Agent. Subject to the truth and accuracy of the
representations and warranties made by Purchaser, the offer, issuance and
delivery of the Shares to Purchaser pursuant to this Agreement constitute an
exempted transaction under the Act, as now in effect, and the registration
thereof under the Act is not now required. Seller has not, directly or
indirectly, sold, offered, disposed of or attempted to sell, offer or dispose of
any securities to or solicited any offers to buy from or otherwise approached or
negotiated in respect thereof with any person or persons in such manner or to
such extent as would disqualify the sale or offer of the Shares from exemption
from registration under the Act or any applicable state's securities laws or
regulations. No agent has been authorized or employed by Seller to negotiate or
solicit the purchase of the Shares.
3.11 Use of Proceeds. The net cash proceeds received by Seller from the
sale contemplated by this Agreement, after payment of legal fees, accounting
fees and other expenses incurred in connection herewith, will be used to the
extent required, to make leasehold improvements to and to furnish and equip
newly developed laboratories leased by Seller and located at 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx, 00000.
3.12 Material Misstatements or Omissions. No representation or warranty by
Seller in this Agreement and no document, written statement, certificate or
schedule furnished by Seller pursuant hereto, or in connection with the
transactions contemplated hereby, contains or will contain any untrue statement
of a material fact, or omits or will omit to state a material fact necessary to
make the statements or facts contained therein not misleading.
4. Additional Obligations and Covenants of Seller.
4.1 Access to Information. Seller agrees to make available to Purchaser
and to representatives designated by Purchaser the opportunity to ask questions
of and receive answers from responsible officers of Seller, its attorneys and
accountants concerning the terms and conditions of this Agreement and any
additional information in Seller's possession or which Seller
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can produce or acquire with our unreasonable effort or expense and which is
reasonably necessary to verify the accuracy of Seller's disclosures under this
Agreement. Seller's commitments under this paragraph 4.1 are made with the
understanding that Purchaser's representatives (a) shall keep confidential any
information (other than information which is readily ascertainable from public
or trade sources of published information) obtained from Seller concerning its
properties, operations and business, and (b) will not trade in securities of
Seller at any time when they have received from Seller material information
which has not theretofore been disclosed to the public.
4.2 Best Efforts. Seller agrees to use its best efforts to satisfy or
cause to be satisfied all of the obligations of Seller under this Agreement, to
the extent that Seller's action or inaction can control or influence the
satisfaction of such conditions.
5. Conditions Precedent to the Obligation of Purchaser. Seller shall
issue and deliver to Purchaser a Stock Certificate (receipt of which is hereby
acknowledged) for 50,000 shares of Common Stock in Seller. Said Stock
Certificate shall be signed by the President of the company and countersigned
by the Clerk of the company and shall be absolute evidence of Purchaser's
ownership in and to the 50,000 shares represented therein, which Shares are
fully paid and non assessable.
5.1 No Adverse Changes. There shall have been no changes as of the date
of this Agreement in the results of operations, assets, liabilities, financial
condition or affairs of Seller which have not been disclosed to Purchaser and
have in their effect been adverse to Seller.
5.2 Officer's Certificate. Seller shall have delivered to Purchaser
certificates (Exhibit 5.2) dated the date of this Agreement executed by the
President and the Clerk of Seller to the effect that to the best of the
knowledge and belief of each: (a) all of the representations and warranties of
Seller contained in this Agreement are true and accurate; (b) all of the
conditions precedent to the obligations of Purchaser on the Closing Date have
been fulfilled; and (c) Seller has duly performed all obligations and covenants
to be performed by it under this Agreement on or before the date of this
Agreement.
6. Registration under the Securities Act.
6.1 Notice of Proposed Transfers. The holder of each certificate
representing Shares by acceptance thereof, agrees prior to any proposed transfer
thereof, to give written notice to Seller of such holder's intention to effect
such transfer. Each such notice shall describe the manner and circumstances of
the proposed transfer in sufficient detail, shall contain an undertaking by the
person giving such notice to furnish such further information as may be required
to enable counsel to render the opinions referred to below and shall name the
counsel for the person giving such notice. Promptly upon receiving any such
notice, Seller shall submit copies thereof to its counsel and to counsel
designated by the person giving such notice. Such proposed transfer may be
effected only if in the opinion of each such counsel the proposed transfer may
be effected without registration under the Act of such Shares. If such counsel
are of the opinion that the transfer may be effected, Seller shall so notify the
holder of such Shares and such holder shall thereupon be entitled to transfer
such shares in accordance with the terms of the notice delivered by such holder
to Seller. Each certificate evidencing the Shares to be transferred as above
provided shall bear the appropriate restrictive legend set forth in paragraph
7.1 below.
6.2 Incidental Registration. If at any xxxx Xxxxxx proposes to register
any of its securities under the Act (other than on form S-8 or S-14 or other
form related to an offering of the type to which such forms relate), it will
each such time give written notice to all holders of Shares of its intention so
to do and, upon the written request of any holders of Shares, given within 20
days after the giving of any such notice (which request shall state the
intended method of disposition of such Shares by the prospective seller),
Seller will use its best efforts to cause all
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Shares, the holders of which shall have so requested registration thereof, to be
registered under the Act, all to the extent requisite to permit the sale or
other disposition (in accordance with the intended methods thereof, as
aforesaid) by the prospective seller or sellers of the Shares so registered.
6.3 Registration Procedures and Expenses. If and whenever Seller effects
the registration of any of its securities under the Act, Seller will as
expediently as possible:
(a) prepare and file with the Commission a registration statement
with respect to the offering of such securities. Such
registration statement to become and remain effective for such
period as may be required or permitted by law for the sale of all
shares proposed to be sold by the holders, not exceeding 180
days:
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such
registration statement effective as may be required by the
immediately preceding subdivision and to comply with the
provisions of the Act with respect to the transfer of all
securities covered by such registration statement whenever, prior
to the expiration of 180 days after the effective date thereof, a
seller desires to transfer the same:
(c) furnish to each selling shareholder such numbers of copies of a
summary prospectus or other prospectus, including a preliminary
prospectus, in conformity with the requirements of the Act, and
such other documents as such seller may reasonably request in
order to facilitate the transfer of the securities owned by such
seller, and
(d) use its best efforts to register or qualify the securities
covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as each such
seller shall request and do any and all other acts and things
which may be necessary or advisable to enable such seller to
consummate the transfer in such jurisdictions of the securities
owned by such seller.
All expenses incurred by Seller in complying with this paragraph 6.3, including
without limitation all registration, qualification and filing fees, printing
expenses, fees and disbursements of counsel to Seller and the expense of any
special audits incident to or required by any such registration are herein
called "Registration Expenses"; and all underwriting discounts applicable to the
Shares and all fees disbursements of counsel for any seller are herein called
"Selling Expenses".
6.4 Allocation of Expenses. The Company will pay all Registration Expenses
in connection with each registration statement pursuant to paragraph 6.3 hereof.
6.5 Indemnification. In the event of any registration of any of the Shares
under the Act pursuant to this paragraph 6, Seller will indemnify and hold
harmless each seller of such Shares, each underwriter of such Shares, and each
other person, if any, who controls such seller or underwriter within the meaning
of the Act, against any losses, claims, damages or liabilities joint or several,
to which such seller, underwriter or controlling person may become subject under
the Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained, on the effective
date thereof, in any registration statement under which such Shares was
registered under the Act, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereto, or arise out of or
are based upon the omission or
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alleged omission to state therein a material fact required to be suited therein
or necessary to make the statements therein not misleading; and will reimburse
such seller, underwriter and each such controlling person for any legal or other
expenses reasonably incurred by such seller, underwriter or such controlling
person in connection with investigating or defending any such loss, claim,
damage or liability, provided, however, that Seller will not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made in said registration statement, said
preliminary prospectus or said prospectus or said amendment or supplement in
reliance upon and conformity with written information furnished to Seller
through an instrument duly executed by such seller or underwriter specifically
for use in the preparation thereof.
It shall be a condition precedent to the obligation of Seller to complete
any action pursuant to paragraph 6.3 hereof that Seller shall have received an
undertaking satisfactory to it from each prospective seller of Shares to be
registered under each registration pursuant to paragraphs 6.2 and 6.3 hereof,
and from each underwriter of such, to indemnify and hold harmless (in the same
manner and to the same extent as set forth above in this paragraph with respect
to Seller) Seller, each director of Seller, each officer of Seller who shall
sign such registration statement and each person who controls Seller within the
meaning of the Act, with respect to any statement in or omission from any such
registration statement or preliminary or final prospectus, if such statement
or omission was made in reliance upon and in conformity with information
furnished in writing to Seller by or on behalf of such seller specifically for
use in connection with the preparation of such registration statement or
prospectus.
The foregoing notwithstanding, in the event a claim for reimbursement of
liabilities under the Act by reason of the foregoing indemnity provisions of
this Agreement is asserted by any director of Seller or by any person in control
of Seller within the meaning of the Act in the absence of controlling precedent,
Seller will have the right to submit to a court of appropriate jurisdiction the
question of whether such reimbursement by it is against public policy as
expressed in the Act and Seller and each such director and controlling person
will be governed by the final adjudication of such issue.
6.6 Termination of Restrictions. Nothwithstanding the foregoing
provisions of this paragraph 6, the restrictions imposed by this paragraph 6
upon the transferability of the Shares, shall cease and terminate as to any
Share, when such Shares shall have been effectively registered under the Act.
Whenever the restrictions imposed by this paragraph 6.6 shall terminate, as
hereinabove provided, the holder of any Shares as to which such restrictions
shall have terminated shall be entitled to receive from Seller, without expense,
a new stock certificate or certificates in such denominations as the holder may
reasonably request not bearing the restrictive legend set forth in paragraph 6.1
below and not containing any other reference to the restrictions imposed by this
paragraph 6, provided, however, that in the event that any such Shares shall
not, in fact, have been sold pursuant to such registration under the Act, such
holder shall promptly redeliver the new stock certificate received as aforesaid
to Seller in exchange for a stock certificate bearing the restrictive legend set
forth in paragraph 7.1 below.
7. Restrictions.
7.1 Legend. The Shares and all shares issued hereafter and prior to any
registration under the Act shall bear the following restrictive legend:
''The transfer of the Shares represented by this Certificate is
restricted as provided for the in the Securities Act of 1933 (the ''Act''). Said
Shares cannot be transferred unless registered under the Act or pursuant to an
opinion from Seller's counsel that such transfer is exempt from the provisions
of the Act.''
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8. Affirmative Covenants. Seller agrees that subject to any binding
majority vote of is shareholders it will:
8.1 Insure and keep insured and cause any subsidiary to insure and keep insured
its inventory, machinery, equipment and buildings against loss or damage by fire
(with extended coverage), explosion and other hazards, including, without
limiting the generality of the foregoing, maintain and cause each of its
subsidiaries to maintain adequate insurance against liability due to damage to
persons and property; and maintain all such workmen's compensation insurance as
may be required under the laws of any state or jurisdiction in which it may be
engaged in business, except that the Seller may effect workmen's compensation or
similar insurance in respect of operations in any jurisdiction by causing to be
maintained a system or systems of self-insurance which is in accord with
applicable laws, and cause each of its subsidiaries so to do in each state or
jurisdiction in which it may be engaged in business: all such insurance (except
war damage insurance carried with a government or governmental agency) to be
carried in financially sound and reputable insurance companies, and provided,
further, however, that the Seller's obligation to maintain such insurance shall
be limited by the types of insurance and limits of coverage thereof which are
available at the time or times at premiums the Seller deems reasonable in the
light of prevailing conditions against such casualties and contingencies in such
types and amounts as are consistent with the practice and policy as to insurance
followed by the Seller at the time hereof.
8.2 Duly pay and discharge, or cause to be paid and discharged, all rates,
assessments and other governmental charges imposed upon it or any subsidiary and
its or their properties or any part thereof or upon the income or profits
therefrom as well as all claims for labour, materials or supplies which if
unpaid by law become a lien or charge upon any such property, except such items
as are being in good faith appropriately contested and for which adequate
reserves have been established.
8.3 Carry on and conduct its business in substantially the same manner and
in substantially the same fields as such business is now and heretofore been
carried on, and maintain its corporate existence and comply with all valid and
applicable statutes, rules and regulations.
8.4 Maintain for itself, and each subsidiary, a modern system of
accounting and furnish to the holders of the Shares (i) within 120 days after
the close of each fiscal year audited financial statements prepared by an
independent certified public accountants acceptable to the Board of Directors
including consolidated balance sheets as of the end of such period and related
profit and loss and surplus statements of the Seller, (ii) within 30 days after
the end of each quarter balance sheets and profit and loss and surplus
statements of the Seller as of the close of such quarter, and statements of
income and reconciliation of surplus for the year to date of such statements of
the Seller certified as accurate in all material respects by a responsible
officer of the Seller as having been prepared in accordance with generally
accepted accounting principles consistently applied, (iii) Promptly upon
becoming available all statements and reports that may be required to be filed
with the Securities Exchange Commission or furnished to the Shareholders of the
Seller, and (v) such other information as the Purchaser may from time to time
reasonably request including access to the books and records of the Seller and
to examine such books and records, take memoranda and extracts therefrom.
8.5 Prepare and submit to the Board of Directors of Seller a preliminary
budget in summary form for each fiscal year of the Seller at least thirty (30)
days prior to the beginning of such fiscal year followed by a comprehensive
budget not later than the first day of such year which comprehensive budget
shall be accompanied by management's written discussion and analysis of such
budget. The budget shall be presented to the directors for approval not later
than the first meeting of the Board of Directors in each year and shall be
accepted as the budget for such fiscal year when it has been approved by a
majority of the full Board of Directors of the Seller.
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Management shall review the budget periodically and shall advise the Board of
Directors of all changes therein and all material deviations therefrom.
8.6 Shall maintain key man life insurance, on which the Seller is
beneficiary on the life Xx. Xxx Xxxxx in the amount of $500,000.
9. Negative Convenants. Without the affirmative action of a majority of
the Shares of Shareholders present at a duly convened Shareholders Meeting
Seller shall not:
9.1 Merge with or into or consolidate with any other entity or lease or
sell all, or substantially all, of its property, assets and business to any
other entity, or dispose of any of its assets, property or business except
(i) in the ordinary course of business (ii) subsidiaries may merge into the
Seller or into another subsidiary.
9.2 Issue any preferred stock or other securities, other than pursuant to
the rights set forth in the existing Articles of Incorporation.
9.3 Alter or amend its Articles of Incorporation or Bylaws.
10. Affirmative Actions of the Board of Directors. Seller agrees that,
without the affirmative action of a majority of the members of the Board of
Directors, neither Seller nor any subsidiary shall:
(i) Create or incur, or suffer to exist any pledge, mortgage,
assignment for security or other encumbrance.
(ii) Declare or pay any dividends or make or declare any other
distributions on its capital stock or redemption thereof.
(iii) Make or permit to exist investments.
(iv) Sell or otherwise dispose of more than 10% of aggregate
fixed assets determined by book value during any 12
consecutive month period.
(v) Sell any notes or accounts receivable with or without
recourse other than as permitted by Section 10(vii).
(vi) Sell, pledge, mortgage or otherwise dispose or transfer of
any shares of stock in Seller or another corporation, or all
or substantially all, the assets of any subsidiary of Seller.
(vii) Incur, or permit to exist.
(viii) Expend or contract to expend any sum for any fixed assets
(including but not limited to, sums expended to acquire
equity in any entity) in an amount exceeding $50,000 per
expenditure.
(ix) Alter or amend its Bylaws
(x) Pay any bonuses to employees who are shareholders of the
company.
11. Notices. All notices, requests, demands and other communication under
this Agreement shall be in writing and shall be deemed to have been duly given
at the time given or mailed, first class postage prepaid.
