AGREEMENT FOR SALE OF STOCK
This agreement is made and entered into this 20th day of August, 2000, by and
between Covalent Partners, LLC, a Delaware limited liability company (Seller)
and ▇▇▇▇▇▇▇ ▇▇▇▇▇, M.D. (Buyer).
WHEREAS, Seller is the owner of Four Hundred Sixty Thousand (460,000) shares of
the common stock (the Stock) of Covalent Group, Inc. (Covalent) that Seller
wishes to sell; and
WHEREAS, Buyer wishes to purchase the Stock from Seller, and Seller wishes to
sell the Stock to Buyer on the terms set forth in this Agreement;
NOW, THEREFORE, Buyer and Seller agree as follows:
1. Seller shall sell the Stock to Buyer at a purchase price of $3.00 per
share, for a total purchase price of $1,380,000.
2. Payment for the Stock shall be in the form of a secured note in the amount
of $1,380,000 from Buyer to Seller in the form attached hereto as Appendix
A.
3. Upon transfer to Buyer, the Stock shall be subject to the same restrictions
as applied to the Stock when held by Seller, and Buyer shall execute and
deliver to Seller or to the law firm of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP the Investment
Representation Letter that is attached to this Agreement as Appendix B.
4. Buyer represents and warrants that he is an accredited investor within the
meaning of that term under the securities laws of the United States, and
represents specifically that he either: (a) has a net worth of at least
$1,000,000 or (b) has had individual income of $200,000 (or $300,000
jointly with his spouse) during 1998 and 1999 and reasonably expects to
have individual income of $200,000 (or $300,000 jointly with his spouse) in
2000. Buyer agrees to allow Covalent to rely on this representation.
5. This Agreement may be executed in counterparts by the respective parties.
The Agreement shall take effect upon the mutual exchange of faxed signature
pages, to be followed by an exchange of originals of the entire Agreement
and its Appendices, all of which are completed and executed.
IN WITNESS WHEREOF, the parties have set their hands and seals as of the date
first above written.
BUYER SELLER
▇▇▇▇▇▇▇ ▇▇▇▇▇, M.D. COVALENT PARTNERS, LLC
/S/ ▇▇▇▇▇▇▇ Borrow, M.D. /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, M.D.
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, MD, Its Manager
Appendix A
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August 20, 2000 $1,380,0000
SECURED PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇▇ ▇▇▇▇▇, M.D. (Borrower), promises to
pay to Covalent Partners, LLC (Lender), the aggregate sum of One Million Three
Hundred Eighty Thousand Dollars ($1,380,000.00), subject to the following terms
and conditions.
1. Due Date. Payment in full is due no later than August 21, 2005.
2. Interest. Interest shall accrue at the rate of 7% per annum, commencing
on August 21, 2000, and shall accumulate and be due and payable,
together with the principal, on August 21, 2005.
3. Security Interest. In order to secure payment of the sums due Lender
hereunder, Borrower grants to Lender a security interest in Four
Hundred Sixty Thousand (460,000) shares of the Common Stock of Covalent
Group, Inc. (the "Stock"), and has delivered to Lender herewith the
certificate(s) representing the Stock, together with an assignment
separate from certificate executed by Borrower directing Covalent
Group, Inc. or its transfer agent to transfer the Stock to Lender.
Lender is entitled to direct such transfer in the event of any default
hereunder.
4. Expenses of Collection. In the event that Borrower shall be in default
under this note he shall be liable for any expenses incurred by Lender
in connection with efforts to collect any amount due to Lender
hereunder, including reasonable attorney's fees.
5. Nature of Transaction. Borrower agrees and affirms that this note is
entered into for commercial purposes and is not made in connection with
a personal or consumer transaction.
6. Governing Law. This note shall be governed by the laws of the State of
California, without regard to its conflict of laws principles.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals this 20th
day of August 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇, M.D. COVALENT PARTNERS, LLC
/s/ ▇▇▇▇▇▇▇ Borrow, M.D. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Its Manager
Appendix B
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August 21, 2000
Covalent Group, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: The purchase of shares of Covalent Group Common Stock from Covalent
Partners, LLC
Gentlemen:
The undersigned hereby makes the following acknowledgments with respect to the
transfer to him of Four Hundred Sixty Thousand (460,000) shares of the Common
Stock of Covalent Group, Inc. (the "Company") from Covalent Partners, LLC (the
"Transferor").
The undersigned understands that the shares have not been registered under the
Securities Act of 1933, as amended (the "Act"), on the basis that no
distribution or public offering of the shares is to be effected. The
undersigned recognizes that the shares being acquired by the undersigned must be
held indefinitely unless they are subsequently registered under the Act or an
exemption from such registration is available. The undersigned recognizes that
the Company has no obligation to register the shares or to comply with any
exemption from such registration.
The undersigned agrees to be bound by all restrictions and obligations with
respect to the shares he/she is acquiring to which the Transferor was bound,
including any restrictions with respect to the transfer or sale of such shares.
The undersigned is aware that the shares may not be sold pursuant to Rule 144
adopted under the Act unless certain conditions are met and until the
undersigned has held the shares for the applicable holding period under Rule
144. Among the conditions for use of the Rule is the availability of current
information to the public about the Company. The undersigned understands that
the Company has not made such information available and has no present plans to
do so.
The undersigned further agrees not to make any disposition of all or any part of
the shares being acquired in any event unless and until:
1. The Company shall have received a letter secured by the undersigned from the
Securities and Exchange Commission stating that no action will be
recommended to the Commission with respect to the proposed disposition; or
2. 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
3. (i) The undersigned shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement
of the circumstances surrounding the proposed disposition, (ii) the
undersigned shall have furnished the Company with an opinion of counsel for
the undersigned to the effect that such disposition will not require
registration of such shares under the Act, and (iii) such opinion of counsel
for the undersigned shall have been concurred in by the Company's counsel
and the Company shall have advised the undersigned of such concurrence.
The undersigned understands and agrees that all certificates evidencing the
shares to be issued to the undersigned shall bear the following legends:
THIS SECURITY HAS NOT BEEN REGISTERED OR QUALIFIED UNDER ANY STATE OF
FEDERAL SECURITIES LAWS AND IS BEING SOLD PURSUANT TO APPLICABLE EXEMPTIONS
FROM REGISTRATION OR QUALIFICATION. THE TRANSFER OF THIS SECURITY IS
RESTRICTED. SEE THE ARTICLES OF INCORPORATION, BYLAWS OR SHAREHOLDER
AGREEMENT FOR DETAILS.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND
CONDITIONS OF A VOTING AGREEMENT WHICH PLACES CERTAIN RESTRICIONS ON THE
VOTING OF THE SHARES REPRESENTED HEREBY. ANY PERSON ACCEPTING ANY INTEREST
IN SUCH SHARES SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL
THE PROVISIONS OF SUCH AGREEMENT. A COPY OF SUCH VOTING AGREEMENT WILL BE
FUNISHED TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON
WRITTEN REQUEST TO THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS.
In addition to the representations and acknowledgements set forth above, the
undersigned further represents that he is an accredited investor within the
meaning of United States Securities laws.
Very truly yours,
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇, M.D.
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▇▇▇▇▇▇▇ ▇▇▇▇▇, M.D.
