FORM OF SECURITIES PURCHASE AGREEMENT
EXHIBIT
10.5
FORM
OF SECURITIES PURCHASE AGREEMENT
SECURITIES
PURCHASE AGREEMENT (this “Agreement”),
dated
as of February __, 2008 by and between Agfeed Industries, Inc., a Nevada
corporation (the “
Company”),
and
the investors named on
Exhibit A
hereto
(each on “
Investor”
and
collectively the “
Investors”).
WITNESSETH
WHEREAS,
the Company has filed with the Securities and Exchange Commission (the
“Commission”)
the
Registration Statement (as defined below) relating to the offer and sale from
time to time of the Company’s securities, including shares of its Common Stock,
$0.001 value (“Common
Stock”);
WHEREAS,
the Company is offering for sale shares of Common Stock registered pursuant
to
the Registration Statement (the “Offered
Shares”);
and
WHEREAS,
each Investor desires to purchase from the Company Offered Shares on the terms
and conditions set forth herein.
NOW,
THEREFORE, in consideration of the recitals (which are deemed to be a part
of
this Agreement), mutual covenants, representations, warranties and agreements
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
| 1. |
Definitions.
As used herein, the following terms have the meanings
indicated:
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“Final
Prospectus”
shall
mean the final prospectus relating to the Investor Shares that is first filed
pursuant to Rule 424(b) after the date and time that this Agreement is executed
and delivered by the parties hereto.
“Person”
shall
mean any individual, partnership, limited liability company, joint venture,
firm, corporation, association, trust or other enterprise or any government
or
political subdivision or any agency, department or instrumentality
thereof.
“Preliminary
Prospectus”
shall
mean the prospectus forming a part of the Registration Statement and the
prospectus supplement relating to the Offered Shares in the form first filed
pursuant to Rule 424(b) under the Securities Act, as amended (the “
Securities Act”),
as
further amended or supplemented at the relevant time, and used prior to the
filing of the Final Prospectus, and shall include all information and documents
incorporated by reference in such prospectus.
“Registration
Statement”
shall
mean the registration statement on Form S-3 (File No. 333-148386), including
a
prospectus, relating to the offer and sale of certain of the Company’s Common
Stock, which was declared effective by the Commission on January 11, 2008.
References herein to the term “Registration Statement” as of any date shall mean
such effective registration statement, as amended or supplemented to such date,
including all information and documents incorporated by reference therein as
of
such date.
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2.
Purchase
of Common Stock.
Subject
and pursuant to the terms and conditions set forth in this Agreement, the
Company agrees that it will issue and sell to the Investor and the Investor
agrees that it will purchase from the Company the number of Offered Shares
set
forth on Schedule I
attached
hereto (the “Investor
Shares”).
The
aggregate purchase price for the Investor Shares (the “
Aggregate Purchase Price”)
and
the purchase price per Investor Share is set forth on Schedule I
hereto.
The closing of the purchase and sale of the Investor Shares will be on the
date
and at the time set forth on Schedule I
hereto,
or such other date or time as the parties may agree upon in writing (the
“
Closing”).
The
Company may enter into agreements similar to this Agreement with certain
other
investors and expects to complete sales of Offered Shares to them. The Company
may accept or reject any one or more of such Agreements in its sole
discretion.
| 3. |
Deliveries
at Closing.
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(a) Deliveries
by the Investor.
At the
Closing, each Investor shall deliver to the Company the Aggregate Purchase
Price
by wire transfer of immediately available funds to an account designated by
the
Company as set forth on Schedule I
hereto,
which funds will be delivered to the Company in consideration of the Investor
Shares issued at the Closing.
(b) Deliveries
by the Company.
At the
Closing, the Company shall deliver to each Investor, using customary book-entry
procedures, the Investor Shares.
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Representations,
Warranties, Covenants and Agreements.
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(a) Investor
Representations, Warranties and Covenants.
Each
Investor represents, warrants and agrees as follows:
(1) Investor
is duly incorporated and has a valid existence and the authorization to transact
business as a corporation under the laws of its jurisdiction of incorporation
and is in good standing under the laws of each other jurisdiction in which
it
owns or leases properties or conducts any business so as to require such
qualification.
(2) Investor
has received and reviewed copies of the Registration Statement and the
Preliminary Prospectus, including all documents and information incorporated
by
reference therein and amendments thereto, and understands that no Person has
been authorized to give any information or to make any representations that
were
not contained in the Registration Statement and the Preliminary Prospectus,
and
Investor has not relied on any such other information or representations in
making a decision to purchase the Investor Shares. Investor hereby consents
to
receiving delivery of the Registration Statement and the Preliminary Prospectus,
including all documents and information incorporated by reference therein and
amendments thereto, by electronic mail. Investor understands that an investment
in the Company involves a high degree of risk for the reasons, among others,
set
forth under the captions “RISK FACTORS” in the Prospectus.
(3) Investor
acknowledges that it has sole responsibility for its own due diligence
investigation and its own investment decision, and that in connection with
its
investigation of the accuracy of the information contained or incorporated
by
reference in the Registration Statement and the Preliminary Prospectus and
its
investment decision, Investor has not relied on (a) any representation or
information not set forth in this Agreement, the Registration Statement or
the
Preliminary Prospectus, (b) any Person affiliated with the Company or (c) the
fact that any other Person has decided to invest in the Offered Shares. Investor
understands that nothing in the Prospectus, this Agreement or any other
materials presented to such Investor in connection with the purchase and sale
of
the Offered Shares constitutes legal, tax or investment advice. Such Investor
has consulted such legal, tax and investment advisors as it, in its sole
discretion, has deemed necessary or appropriate in connection with its purchase
of Investor Shares.
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(4) The
execution and delivery of this Agreement by Investor and the performance of
this
Agreement and the consummation by Investor of the transactions contemplated
hereby have been duly authorized by all necessary (corporate, partnership or
limited liability in the case of a corporation, partnership or limited liability
company) action of Investor, and this Agreement, when duly executed and
delivered by Investor, will constitute a valid and legally binding instrument,
enforceable in accordance with its terms against Investor, except as enforcement
hereof may be limited by the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws or court decisions affecting enforcement of
creditors’ rights generally and except as enforcement hereof is subject to
general principles of equity (regardless of whether enforcement is considered
in
a proceeding in equity or at law).
(5) No
state,
federal or foreign regulatory approvals, permits, licenses or consents or other
contractual or legal obligations are required for Investor to enter into this
Agreement or purchase the Investor Shares.
(6) Each
Investor, if outside the United States of America, will comply with all
applicable laws and regulations in each jurisdiction where it purchases, offers,
sells or delivers Offered Shares or has in its possession or distributes any
offering material, in all cases at its own expense.
(7) From
and
after obtaining the knowledge of the sale of the Investor Shares contemplated
hereby, such Investor has not taken, and prior to the public announcement of
the
transaction such Investor shall not take, any action that has caused or will
cause such Investor to have, directly or indirectly, sole or agreed to sell
any
shares of Common Stock, effected any short sale, whether or not against the
box,
established any “put equivalent position” (as defined in Rule 16a-1(h) under the
Exchange Act) with respect to the Common Stock, granted any other right
(including, without limitation, any put or call option) with respect to the
Common Stock or with respect to any security that includes, related to or
derives any significant part of its value from the Common Stock, whether or
not,
direct or indirectly, in order to hedge its positions in the Investor
Shares.
(8) The
execution, delivery and performance by Investor of this Agreement and the
consummation by Investor of the transactions contemplated herein do not and
shall not (i) result in a violation of Investor’s charter documents, bylaws or
other applicable organizational instruments, (ii) conflict with, constitute
a
default (or an event which, with notice or lapse of time or both, would become
a
default) under, or give rise to 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 Investor is a party or is bound, (iii) create or impose any lien,
charge or encumbrance on any property of the Investor under any agreement or
any
commitment to which Investor is party or under which Investor is bound or under
which any of its properties or assets are bound, or (iv) result in a violation
of any federal, state, local or foreign statute, rule, or regulation, or any
order, judgment or decree of any court or governmental agency applicable to
Investor or by which any of its properties or assets are bound or affected,
except, in the case of clauses (ii), (iii) and (iv), for such conflicts,
defaults, terminations, amendments, acceleration, cancellations and violations
as would not, individually or in the aggregate, prohibit or otherwise interfere
with the ability of the Investor to enter into and perform its obligations
under
this Agreement in any material respect.
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(b) Company
Representations, Warranties and Covenants.
The
Company hereby represents, warrants and agrees as follows:
(1) The
Company and each of its subsidiaries listed on Schedule II hereto (the
“Subsidiaries”)
has
been duly incorporated and has a valid existence and the authorization to
transact business as a corporation under the laws of its jurisdiction of
incorporation, with corporate power and authority to own and lease its
properties and conduct its business as described in the Preliminary Prospectus,
and has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other jurisdiction
in
which it owns or leases properties or conducts any business so as to require
such qualification, except for such jurisdictions wherein the failure to be
so
qualified and in good standing would not individually or in the aggregate have
a
material adverse effect on the business, results of operations or financial
condition of the Company and its subsidiaries taken as a whole (a “
Material Adverse Effect”).
(2) No
consent, approval, authorization, order, registration, filing or qualification
of or with any such court or governmental, regulatory or self-regulatory agency
or body is required for the valid authorization, execution, delivery and
performance by the Company of this Agreement or the issuance of the Investor
Shares, except for such consents, approvals, authorizations, registrations,
filings or qualifications as may be required under the Securities Act or state
securities or “blue sky” laws or have been or will be obtained or made in
connection with the listing of the Investor Shares on the Nasdaq National
Market.
(3) The
authorized, issued and outstanding capital stock of the Company is as set forth
in the Preliminary Prospectus and as will be as set forth in the Final
Prospectus under the caption “Capitalization” (other than for issuances after
the dates thereof, if any, pursuant to employee benefit plans, or upon exercise
of outstanding options or warrants, as the case may be). The Common Stock,
including the Investor Shares, conforms, and in the case of the Final
Prospectus, will conform, in all material respects to the description thereof
contained in the Preliminary Prospectus and the Final Prospectus. All the issued
and outstanding shares of the capital stock of the Company have been duly
authorized and validly issued, are fully paid and nonassessable and have been
issued in compliance, in all material respects, with all applicable laws. None
of the outstanding shares of Common Stock of the Company were issued in
violation of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities of the Company. There are no
authorized or outstanding options, warrants, preemptive rights, rights of first
refusal or other rights to purchase, or equity or debt securities convertible
into or exchangeable or exercisable for, any capital stock of the Company other
than those described in the Preliminary Prospectus and those that will be
described in the Final Prospectus.
(4) The
execution, delivery and performance of this Agreement by the Company and the
consummation of the transactions contemplated hereby are within the corporate
powers of the Company and have been duly authorized by all necessary corporate
action on the part of the Company and this Agreement, when duly executed and
delivered by the parties hereto, will constitute a valid and legally binding
instrument of the Company enforceable in accordance with its terms, except
as
enforcement hereof may be limited by the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws or court decisions affecting
enforcement of creditors’ rights generally and except as enforcement hereof is
subject to general principles of equity (regardless of whether enforcement
is
considered in a proceeding in equity or at law).
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(5) The
Investor Shares have been duly authorized by the Company, and when issued and
delivered by the Company against payment therefor as contemplated by this
Agreement, the Investor Shares will be validly issued, fully paid and
nonassessable, and will conform to the description of the Common Stock contained
in the Preliminary Prospectus.
(6) The
execution and delivery of this Agreement do not, and the compliance by the
Company with the terms hereof will not, (i) violate the Articles of
Incorporation (as amended to date) of the Company or the By-Laws (as amended
to
date) of the Company, (ii) result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which the
Company or any of its Subsidiaries is a party or by which the Company or any
of
its Subsidiaries is bound or to which any of their properties or assets are
subject, or (iii) result in a violation of, or failure to be in compliance
with, any applicable statute or any order, judgment, decree, rule or regulation
of any court or governmental, regulatory or self-regulatory agency or body
having jurisdiction over the Company or any of its Subsidiaries or any of their
properties or assets, except where such breach, violation, default or the
failure to be in compliance would not individually or in the aggregate have
a
Material Adverse Effect or adversely affect the ability of the Company to issue
and sell the Investor Shares.
(7) The
Company meets the requirements for the use of Form S-3 under the Securities
Act for the primary issuance of securities. The Registration Statement has
been
declared effective by the Commission and at the time it became effective, and
as
of the date hereof, the Registration Statement complied and complies with
Rule 415 under the Securities Act. No stop order suspending the
effectiveness of the Registration Statement has been issued and no proceeding
for that purpose has been initiated or, to the Company’s knowledge, threatened
by the Commission. On the effective date of the Registration Statement, the
Registration Statement complied, on the date of the Prospectus, the Preliminary
Prospectus complied, and at the date of the Closing, the Final Prospectus will
comply, in all material respects with the applicable provisions of the
Securities Act and the applicable rules and regulations of the Commission
thereunder; on the effective date of the Registration Statement, the
Registration Statement did not, on the date of the Preliminary Prospectus,
the
Preliminary Prospectus did not, and at the date of the Closing, the Final
Prospectus and other information provided in writing to the Investors, when
ready together, will not, contain an untrue statement of a material fact or
omit
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 (with respect to the Prospectus), not misleading; and when filed with
the
Commission, the documents incorporated by reference in the Registration
Statement, the Prospectus and the Final Prospectus, taken as a whole, complied
or will comply in all material respects with the applicable provisions of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”),
and
the applicable rules and regulations of the Commission thereunder. There is
no
material document of a character required to be described in the Registration
Statement, the Preliminary Prospectus or the Final Prospectus or to be filed
as
an exhibit to the Registration Statement that is not described or filed as
required.
(8) The
Company is not, and does not intend to conduct its business in a manner in
which
it would become, an “investment company” as defined in Section 3(a) of the
Investment Company Act of 1940, as amended.
| 5. |
Miscellaneous.
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(a) Fees
and Expenses.
The
Company shall pay for the Investor’s legal and other expenses related to this
offering. The Company shall be responsible for its own expenses incurred in
connection with the transactions contemplated hereby. In addition,
the
Company shall be responsible for the payment of any placement agent’s fees,
financial advisory fees, or broker’s commissions (other than for persons engaged
by any Investor) relating to or arising out of the transactions contemplated
hereby, including, without limitation, a finders fee payable to Four Tong
Investment Ltd. in the amount of 8% of the total financing received by the
Company hereunder, which shall paid
on
the Closing.
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(b) Binding
Agreement; Assignment.
This
Agreement shall be binding upon, and shall inure solely to the benefit of,
each
of the parties hereto, and each of their respective heirs, executors,
administrators, successors and permitted assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. The Investors
may not assign any of these rights or obligations hereunder to any other person
or entity without the prior written consent of the Company.
(c) Entire
Agreement.
This
Agreement, including Exhibit A,
Schedule I
and
Schedule
II
hereto,
constitutes the entire understanding between the parties hereto with respect
to
the subject matter hereof and may be amended only by written execution by both
parties. Upon execution by the Company and the Investors, this Agreement shall
be binding on each of the parties hereto.
(d) Consent
To Jurisdiction.
THIS
AGREEMENT SHALL BE ENFORCED, GOVERNED AND CONSTRUED IN ALL RESPECTS IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ITS
CONFLICTS OF LAWS PRINCIPLES. FURTHERMORE, THE INVESTOR HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF THE FEDERAL OR STATE COURTS LOCATED IN THE STATE
OF NEW YORK, NEW YORK COUNTY,
IN
ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE COMPANY AND THE INVESTOR (AND,
TO
THE EXTENT PERMITTED BY LAW, ON BEHALF OF ITS AND THEIR EQUITY HOLDERS AND
CREDITORS) HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ANY RIGHT IT
MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED UPON, ARISING OUT OF
OR IN
CONNECTION WITH THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY.
(e) Notices.
All
notices, requests, consents and other communication hereunder shall be in
writing, shall be mailed by first class registered or certified mail, or
nationally recognized overnight express courier postage prepaid, and shall
be
deemed given when so mailed and shall be delivered as addressed as
follows:
if
to the
Company, to:
1095
Xxxx
Xxx Avenue
Economic
and Technical Development Zone
Xxx
Xxxxx
City, Jiangxi Province
China,
330013
with
a
copy mailed to:
Xxxxx
Xxxxxxx, LLP
000
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxx Xxxxx, Esq.
or
to
such other Person at such other place as the Company shall designate to the
Investors in writing; and if to the Investors, at the addresses as set forth
on
Exhibit A
hereto,
or at such other address or addresses as may have been furnished to the Company
in writing.
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(f) Counterparts.
This
Agreement maybe executed in any number of counterparts and by the parties hereto
in separate counterparts, each of which when so executed shall be deemed to
be
an original and all of which taken together shall constitute one in the same
agreement.
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
INVESTORS:
Accepted
and agreed to as of the date
first
above written:
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By:
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Telephone:
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Facsimile:
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Email
Address:
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Nominee
(name in which Investor Shares are to be registered,
if
different than name of Investor):
________________________
Address
of Nominee:
________________________
________________________
Taxpayer
ID. Number: ________________________
(if
acquired in the name of a nominee, the taxpayer ID. number of such
nominee)
Broker:
________________________
Broker
Contact Name: ________________________
Broker
Contact Telephone: ________________________
Broker
Contact Facsimile: ________________________
Broker
Contact E-mail Address: ________________________
DTC
account number: ________________________
