Common Stock Purchase Agreement
This
Common Stock Purchase Agreement (“Agreement”) is made as of the 23rd
day
December of 2005, between Neuralstem, Inc., a Delaware corporation (the
“Company”), and the individuals and entities listed on Schedule
A
(the
“Purchaser”).
WHEREAS,
the Company is willing to sell to the Purchaser, and the Purchaser desires
to
purchase, 1,000,000 shares of the Company's Common Stock, all according to
the
terms and conditions hereof;
Now,
therefore, the parties agree as follows:
1.
Sale
of Stock. The
Company hereby agrees to sell and issue to the Purchaser, and the Purchaser
hereby agrees to purchase from the Company, for a purchase price of $ .50 per
share, 1,000,000 shares (the “Shares”) of the Company's Common Stock. The total
purchase price to be paid by the Purchaser for the Shares shall be U.S. $
500,000.
2.
Payment
of Purchase Price. The
purchase price for the Shares shall be due and payable by the Purchaser prior
to
the transfer of the Shares.
3.
Issuance
of Shares. Upon
receipt by the Company of the purchase price specified above, the Company shall
promptly cause the issuance and delivery of a duly executed certificate in
the
name of the Purchaser evidencing the Shares.
4.
Representations,
Warranties and Agreements of the Purchaser.
4.1
Authorization. The
Purchaser represents and warrants that this Agreement, when executed and
delivered by it, will constitute a valid and legally binding obligation of
such
Purchaser.
4.2
Purchase
for Own Account. The
Purchaser represents that it is acquiring the Shares solely for its own account
and beneficial interest for investment and not for sale or with a view to
distribution of any part thereof, has no present intention of selling (in
connection with a distribution or otherwise), granting any participation in
or
otherwise distributing the same, and does not presently have reason to
anticipate a change in such intention. The Purchaser also represents that the
entire legal and beneficial interest of Shares it is purchasing is being
purchased for the account of the Purchaser only and neither in whole nor in
part
for any other person, and that any transfer of the Shares will be made in
compliance with the Securities Act of 1933, as amended (the “Act”), the
California Corporate Securities Law of 1968, as amended, and all other
applicable securities laws.
4.3
Information
and Sophistication. The
Purchaser is aware of the Company's business affairs and financial condition,
and acknowledges that it has received all the information it has requested
from
the Company and considers necessary or appropriate for deciding whether to
purchase the Shares. The Purchaser represents that it has had an opportunity
to
ask questions and receive answers from the Company regarding the terms and
conditions of the offering of the Shares and to obtain any additional
information necessary to verify the accuracy of the information given the
Purchaser. The Purchaser further represents that it has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risk of this investment.
4.4
Ability
to Bear Economic Risk.
The
Purchaser acknowledges that investment in the Shares involves a high degree
of
risk, and represents that it is able, without materially impairing its financial
condition, to hold the Shares for an indefinite period of time and to suffer
a
complete loss on its investment.
4.5
Restricted
Securities.
(a)
The
Purchaser understands that the Shares it is purchasing are not registered under
the Act, inasmuch as they are being acquired from the Company in a transaction
not involving a public offering, and that such securities may not be resold,
transferred or otherwise disposed of without registration under the Act or
an
exemption therefrom, and further, that the Company is under no obligation to
register such securities. The Purchaser understands that the Shares have not
been registered under the Act in reliance upon a specific exemption therefrom,
which exemption depends upon, among other things, the bona fide nature of its
investment intent as expressed herein. In this connection, the Purchaser
understands that, in the view of the Securities and Exchange Commission (the
“SEC”), the statutory basis for such exemption may be unavailable if its
representation was predicated solely upon a present intention to hold the shares
for the minimum capital gains period specified under tax statutes, for a
deferred sale, for or until an increase or decrease in the market price of
the
Shares, or for a period of one year or any other fixed period in the
future.
(b)
The
Purchaser represents that it is familiar with Rule 144, as presently in effect,
which in substance permits limited public resale of “restricted securities”
acquired, directly or indirectly, from the issuer thereof (or from an affiliate
of such issuer), in a non-public offering subject to the satisfaction of certain
conditions, including, among other things: (1) the availability of certain
public information about the Company; (2) the resale occurring not less than
one
year after the party has purchased, and made full payment for, within the
meaning of Rule 144, the securities to be sold; and (3) in the case of an
affiliate, or of a non-affiliate who has held the securities less than two
years, the sale being made through a broker in an unsolicited “broker's
transaction” or in a transaction directly with a market maker (as said term is
defined under the Securities Exchange Act of 1934, as amended) and the amount
of
securities being sold during any three-month period not exceeding the specified
limitations stated therein, if applicable. The Purchaser further understands
that at the time it may wish to sell the Shares there may be no public market
upon which to make such a sale, and that, even if such a public market then
exists, the Company may not be satisfying the current public information
requirements of Rule 144, and that, in such event, the Purchaser would be
precluded from selling the shares under Rule 144 even if the one-year minimum
holding period had been satisfied. Notwithstanding the fact that Rule 144 is
not
exclusive, the Purchaser understands that the staff of the SEC has expressed
its
opinion that persons proposing to sell private placement securities other than
in a registered offering and otherwise than pursuant to Rule 144 will have
a
substantial burden of proof in establishing that an exemption from registration
is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own
risk.
4.6
Limitation
on Disposition.
(a)
Without
limiting the foregoing, the Purchaser agrees that it will in no event make
any
disposition of any of the Shares unless and until:
(i)
there is
then in effect a registration statement under the Act covering such proposed
disposition and such disposition is made in accordance with said registration
statement; or
(ii)
the
Purchaser shall have notified the Company of the details of the proposed
disposition and, if the Company so requests, shall have provided the Company
with an opinion of counsel satisfactory to the Company to the effect that such
disposition will not require registration of the Shares under the
Act.
(b)
The
Purchaser understands that the Company's stock transfer records will be noted
to
reflect the restrictions on transferability of the Shares and that certificates
evidencing such securities may bear, in addition to any legend imposed or
required pursuant to applicable state securities law, a legend in substantially
the following form:
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
AND
NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.
NO
SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED.”
2
5.
Miscellaneous.
5.1
Governing
Law. This
Agreement shall be governed in all respects by the laws of the State of
California, without reference to provisions regarding conflicts of
laws.
5.2
Entire
Agreement.
This
Agreement constitutes the full and entire understanding and agreement between
the parties with regard to the subject matter hereof and supersedes all prior
agreements between the parties with respect to the subject matter hereof. No
party shall be liable or bound to any other party in any manner by any
warranties, representations or covenants except as specifically set forth
herein.
5.3
Counterparts.
This
Agreement may be executed in two counterparts, each of which shall be deemed
an
original, but all of which together shall constitute one and the same
instrument.
[Remainder
of Page Intentionally Left Blank]
3
In
Witness Whereof, the undersigned has executed this Common Stock Purchase
Agreement as of the date set forth above.
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| Purchasers: | High Tide, LLC | |
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Title:
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Title:
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Schedule
A
Schedule
of Purchasers
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Name
and Address of Purchaser
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Accredited
Investor
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Number
of Shares
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Amount
of Investment
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Form
of Consideration
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High
Tide, LLC
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Yes
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500,000
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$250,000
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Cash
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Yes
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500,000
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$250,000
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Cash
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TOTAL
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1,000,000
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$500,000
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