EXHIBIT 99.1
------------
EXCHANGE AND PURCHASE AGREEMENT
Among
DYNAGEN, INC.,
and
THE INVESTORS SIGNATORY HERETO
Dated as of February 15, 2001
EXCHANGE AND PURCHASE AGREEMENT
Exchange and Purchase Agreement (this "Agreement"), dated as of
February 15, 2001, by and among DynaGen, Inc., a corporation organized under the
laws of the State of Delaware (the "Company") and the investors signatory hereto
(each such investor is a "Purchaser" and all such investors are, collectively,
the "Purchasers").
WHEREAS:
A. The Company and the Purchasers are executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by Section 4(2) of the Securities Act of 1933, as amended (the "Securities
Act").
B. Each Purchaser holds shares (the "Bazaar Shares") of Series A
Preferred Stock, par value $0.001 per share, of ▇▇▇▇▇▇▇▇.▇▇▇, Inc. ("Bazaar")
issued and outstanding in the name of such Purchaser as of the date hereof (the
"Execution Date").
C. The Company is willing to sell and issue to the Purchasers shares
(the "Shares") of Series O Preferred Stock, par value $0.01 per share, of the
Company (the "Preferred Stock") which are convertible into the shares of the
Company's common stock, $0.01 par value per share (the "Common Stock"), in
accordance with the terms and conditions set forth therein, and the Purchasers
may desire to purchase the same, in consideration for the sale to it of Bazaar
Shares.
NOW, THEREFORE, the Company and the Purchasers hereby agree as follows:
ARTICLE I.
EXCHANGE, PURCHASE AND SALE
I.1 Purchase of Preferred Stock. The Company hereby agrees to issue and
sell to the Purchasers, and each Purchaser agrees to purchase Shares from the
Company, pursuant to the terms and conditions hereof.
I.2 Number of Shares. On or after the date that is fourteen days after
the Execution Date and prior to the expiration of the ten Business Day (as
defined herein) period set forth in the IPO Notice (as defined in the
certificate of designation governing the Bazaar Shares) delivered in connection
with a Qualifying Initial Public Offering (as defined in the certificate of
designation governing the Bazaar Shares), if any, a Purchaser may cause the
Company to issue Preferred Stock in exchange for the Bazaar Shares then held by
such Purchaser by notifying the Company in writing. The Company shall issue in
respect of the Bazaar Share tendered for exchange, a number of Shares equal to
the quotient obtained by dividing: (i) the aggregate Liquidation Value (as
defined in the certificate of designation governing the rights and preferences
of the Bazaar Shares) of such Bazaar Shares by (ii) the Stated Value (as defined
herein). It is understood and agreed that the obligations of the Company to
issue the Shares in exchange for the Bazaar Shares pursuant to the terms hereof
shall not in any way be diminished or effected by the failure or unwillingness
of Bazaar to co-operate in the implementation of the exchange of the Bazaar
Shares pursuant to the terms hereof.
I.3 Additional Agreements and Documents. On the Execution Date, (A) the
Company shall deliver to each Purchaser: (1) an executed Registration Rights
Agreement, dated the date hereof, among the Company and the Purchasers, in the
form of Exhibit B (the "Registration Rights Agreement") and (2) executed
Transfer Agent Instructions, in the form of Exhibit D, delivered to and
acknowledged by the Company's transfer agent (the "Transfer Agent
Instructions"), (B) the Company will deliver to Kenilworth, LLC an executed
Guaranty and Pledge Agreement, dated the date hereof, among the Company, Bazaar
and Kenilworth LLC, in the form of Exhibit C (the "Pledge Agreement"), (C) each
Purchaser shall deliver an executed Registration Rights Agreement and (D)
Kenilworth, LLC will deliver an executed Pledge Agreement.
I.4 Closing. The closing of any purchase and sale of Preferred Stock
hereunder (the "Closing") shall take place at the offices of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP ("▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇"), ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, no later than two (2) Business Days after
the notification pursuant to Section 1.2 above is provided, or at such other
time and place as the Company and each Purchaser effecting such purchase may
agree (the "Closing Date"). At the Closing: (i) such Purchaser shall tender to
the Company, in payment of the purchase price for the Preferred Stock, a
certificate for the number of Bazaar Shares being exchanged together with a
stock power executed in blank, and (ii) the Company shall issue a certificate in
the name of such Purchaser for the shares of Preferred Stock to be issued upon
exchange of such Bazaar Shares pursuant to the terms hereof.
I.5 Terms of Preferred Stock. The Preferred Stock shall have the rights
preferences and privileges set forth in Exhibit A, and shall be incorporated
into a certificate of designation (the "Certificate of Designation") to be filed
prior to the Execution Date by the Company with the Secretary of State of
Delaware, in form and substance mutually agreed to by the parties.
I.6 Certain Defined Terms. For purposes of this Agreement: (a) "Trading
Day" shall have the meanings set forth in Exhibit A, (b) "Business Day" shall
mean any day except Saturday, Sunday and any day which shall be a federal legal
holiday or a day on which banking institutions in the State of New York or the
Commonwealth of Massachusetts are authorized or required by law or other
governmental action to close, and (c) "Person" means an individual or
corporation, partnership, trust, incorporated or unincorporated association,
joint venture, limited liability company, joint stock company, government (or an
agency or subdivision thereof) or other entity of any kind.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
II.1 Representations and Warranties of the Company. The Company hereby
makes the following representations and warranties to the Purchasers:
2
(a) Organization and Qualification. The Company is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware, with the requisite corporate power and authority to own and
use its properties and assets and to carry on its business as currently
conducted. The Company has no subsidiaries other as set forth in Schedule 2.2(a)
(collectively the "Subsidiaries"). Each of the Subsidiaries is an entity, duly
incorporated or otherwise organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization (as
applicable), with the requisite power and authority to own and use its
properties and assets and to carry on its business as currently conducted. Each
of the Company and the Subsidiaries is duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing, as
the case may be, would not reasonably be expected to, individually or in the
aggregate, (x) adversely affect the legality, validity or enforceability of the
Securities (as defined below) or any of this Agreement, the Registration Rights
Agreement, the Pledge Agreement, the Certificate of Designation or the Transfer
Agent Instructions (collectively, the "Transaction Documents"), (y) have or
result in a material adverse effect on the results of operations, assets,
prospects, or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or (z) adversely impair the Company's ability to
perform fully on a timely basis its obligations under any of the Transaction
Documents (any of (x), (y) or (z), a "Material Adverse Effect").
(b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and to consummate the transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations thereunder. The execution and delivery of each of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary corporate action
on the part of the Company. Each of the Transaction Documents has been duly
executed by the Company and, when delivered (or filed, as the case may be) in
accordance with the terms hereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms. Neither the Company nor any Subsidiary is in violation of any of the
provisions of its respective certificate or articles of incorporation, by-laws
or other organizational or charter documents.
(c) Capitalization. The number of authorized, issued and
outstanding capital stock of the Company is set forth in Schedule 2.2(c). Except
as disclosed in the SEC Documents (as defined herein), the Company owns all of
the capital stock of each Subsidiary. No shares of Common Stock are entitled to
preemptive or similar rights, nor is any holder of securities of the Company or
any Subsidiary entitled to preemptive or similar rights arising out of any
agreement or understanding with the Company or any Subsidiary by virtue of any
of the Transaction Documents. Except as a result of the purchase and sale of the
Shares and except as disclosed in the SEC Documents, there are no outstanding
options, warrants, script rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities, rights or obligations
convertible into or exchangeable for, or giving any Person any right to
subscribe for or acquire, any shares of Common Stock, or contracts, commitments,
understandings, or arrangements by which the Company or any Subsidiary is or may
become bound to issue additional shares of Common Stock, or securities or rights
convertible or exchangeable into shares of Common Stock.
3
(d) Issuance of the Shares. When issued upon exchange of the
Bazaar Shares, the Shares will be duly and validly issued, fully paid and
nonassessable, free and clear of all liens, encumbrances and rights of first
refusal of any kind (collectively, "Liens"). The Company shall on the Closing
Date and will, at all times while the Shares are outstanding, maintain an
adequate reserve of duly authorized shares of Common Stock, reserved for
issuance to the holders of the Shares, to enable it to perform its exchange and
conversion obligations under this Agreement and the Certificate of Designation.
Such number of reserved and available shares of Common Stock shall not be less
than 200% of the number of shares of Common Stock which would be issuable upon
conversion in full of the Shares issued on the Closing Date, assuming that the
Shares remain outstanding for three years and that all accrued dividends are
added to the Stated Value (as defined in the Certificate of Designation) (the
"Initial Minimum"). All such authorized shares of Common Stock shall be duly
reserved for issuance to the holders of the shares of the Preferred Stock. The
shares of Common Stock issuable upon conversion of the Preferred Stock are
referred to herein as the "Underlying Shares." The shares of the Preferred Stock
and the Underlying Shares are collectively referred to herein as, the
"Securities") When issued in accordance with the Certificate of Designation, the
Underlying Shares will be duly authorized, validly issued, fully paid and
nonassessable, free and clear of all Liens. The Company will at all times while
the Bazaar Shares are outstanding maintain an adequate reserve of duly
authorized Shares, reserved for issuance to the Purchasers, to enable it to
perform its exchange obligations under this Agreement.
(e) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated thereby do not and will not: (i) conflict with or
violate any provision of the Company's or any of the Subsidiaries' certificate
or articles of incorporation, bylaws or other charter documents (each as amended
through the date hereof), or (ii) subject to obtaining the Required Approvals
(as defined below), 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 (with
or without notice, lapse of time or both) of, any agreement, credit facility,
debt or other instrument (evidencing a Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or by which any
property or asset of the Company or any Subsidiary is bound or affected, or
(iii) result in a violation of any law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority
to which the Company or a Subsidiary is subject (including federal and state
securities laws and regulations), or by which any property or asset of the
Company or a Subsidiary is bound or affected; except in the case of each of
clauses (ii) and (iii), as would not reasonably be expected to, individually or
in the aggregate, have or result in a Material Adverse Effect. The business of
the Company is not being conducted in violation of any law, ordinance or
regulation of any governmental authority, except for violations which,
individually or in the aggregate, would not reasonably be expected to have or
result in a Material Adverse Effect.
4
(f) Filings, Consents and Approvals. Neither the Company nor any
Subsidiary is required to obtain any consent, waiver, authorization or order of,
give any notice to, or make any filing or registration with, any court or other
federal, state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the Company of the
Transaction Documents, other than: (i) the filing of the Certificate of
Designation with the Secretary of State of Delaware, (ii) the filings required
pursuant to Section 3.10, (iii) the filing with the Commission of a registration
statement meeting the requirements set forth in the Registration Rights
Agreement and covering the resale of the Underlying Shares by the Purchasers
(the "Underlying Shares Registration Statement"), (iv) applicable Blue Sky
filings, and (v) in all other cases where the failure to obtain such consent,
waiver, authorization or order, or to give such notice or make such filing or
registration would not reasonably be expected to have or result in, individually
or in the aggregate, a Material Adverse Effect (collectively, the "Required
Approvals").
(g) Litigation; Proceedings. There is no action, suit, inquiry,
notice of violation, proceeding or investigation pending or, to the knowledge of
the Company, threatened against or affecting the Company or any of its
Subsidiaries or any of their respective properties before or by any court,
arbitrator, governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) (collectively, an "Action") which:
(i) adversely affects or challenges the legality, validity or enforceability of
any of the Transaction Documents or the Securities or (ii) except as provided in
the SEC Documents, could, individually or in the aggregate, have or result in a
Material Adverse Effect.
(h) No Default or Violation. Except as described in the SEC
Documents, neither the Company nor any Subsidiary: (i) is in default under or in
violation of (and no event has occurred which has not been waived which, with
notice or lapse of time or both, would result in a default by the Company or any
Subsidiary under), nor has the Company or any Subsidiary received notice of a
claim that it is in default under or that it is in violation of, any indenture,
loan or credit agreement or any other agreement or instrument to which it is a
party or by which it or any of its properties is bound, (ii) is in violation of
any order of any court, arbitrator or governmental body, or (iii) is in
violation of any statute, rule or regulation of any governmental authority, in
each case of clauses (i), (ii) or (iii) above, except as would not reasonably be
expected to individually or in the aggregate, have or result in a Material
Adverse Effect.
(i) Private Offering. Assuming the accuracy of the representations
and warranties of the Purchasers set forth in Sections 2.2(b)-(g), the offer,
issuance and sale of the Securities to the Purchasers as contemplated hereby are
exempt from the registration requirements of the Securities Act. Neither the
Company nor any Person acting on its behalf has taken or is, to the knowledge of
the Company, contemplating taking any action which could subject the offering,
issuance or sale of the Securities to the registration requirements of the
Securities Act including soliciting any offer to buy or sell the Company
Securities by means of any form of general solicitation or advertising.
5
(j) SEC Documents; Financial Statements. The Company has filed all
reports required to be filed by it under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), including pursuant to Section 13(a) or 15(d)
thereof, for the two years preceding the date hereof (or such shorter period as
the Company was required by law to file such material) (the foregoing materials
being collectively referred to herein as the "SEC Documents" and, together with
the Schedules to this Agreement, the "Disclosure Materials") on a timely basis
or has received a valid extension of such time of filing and has filed any such
SEC Documents prior to the expiration of any such extension. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the Securities Act and the Exchange Act and the rules and
regulations of the Commission promulgated thereunder, and none of the SEC
Documents, when filed, 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. All material agreements to which the Company is
a party or to which the property or assets of the Company are subject have been
filed as exhibits to the SEC Documents as required. The financial statements of
the Company included in the SEC Documents comply in all material respects with
applicable accounting requirements and the rules and regulations of the
Commission with respect thereto as in effect at the time of filing. Such
financial statements have been prepared in accordance with GAAP, except as may
be otherwise specified in such financial statements or the notes thereto, and
fairly present in all material respects the financial position of the Company
and its consolidated subsidiaries as of and for 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, immaterial, year-end audit adjustments.
Since September 30, 2000, except as specifically disclosed in the SEC Documents,
(a) there has been no event, occurrence or development that has resulted or that
could result in a Material Adverse Effect, (b) the Company has not incurred any
liabilities (contingent or otherwise) other than (x) liabilities incurred in the
ordinary course of business consistent with past practice and (y) liabilities
not required to be reflected in the Company's financial statements pursuant to
GAAP or otherwise required to be disclosed in filings made with the Commission,
(c) the Company has not altered its method of accounting or the identity of its
auditors and (d) the Company has not declared or made any payment or
distribution of cash or other property to its stockholders or officers or
directors (other than in compliance with existing compensation agreements or
Company stock option plans) with respect to its capital stock, or purchased,
redeemed (or made any agreements to purchase or redeem) any shares of its
capital stock. Notwithstanding the foregoing, the Purchasers are aware that the
Company has sold the assets of its Generic Distributors, Incorporated subsidiary
and is completing the sale of its Superior Pharmaceutical subsidiary as
described in the Company's definitive proxy materials filed with the Commission
on November 3, 2000.
(k) Investment Company. The Company is not, and is not an
Affiliate (as defined in Rule 405 under the Securities Act) of, an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.
(l) Certain Fees. No fees or commissions will be payable by the
Company to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions
contemplated by this Agreement. The Purchasers shall have no obligation with
respect to any fees or with respect to any claims made by or on behalf of other
Persons for fees of a type contemplated in this Section that may be due in
connection with the transactions contemplated by this Agreement. The Company
shall indemnify and hold harmless the
6
Purchasers, their employees, officers, directors, agents, and partners, and
their respective Affiliates, from and against all claims, losses, damages, costs
(including the costs of preparation and attorney's fees) and expenses suffered
in respect of any such claimed or existing fees, as such fees and expenses are
incurred.
(m) Solicitation Materials. Neither the Company nor any Person
acting on the Company's behalf has solicited any offer to buy or sell the
Securities by means of any form of general solicitation or advertising.
(n) Listing and Maintenance Requirements Compliance. The Common
Stock has been delisted from the Nasdaq SmallCap Market. Except as provided in
the SEC Documents, the Company has not, in the two years preceding the date
hereof, received notice (written or oral) from any stock exchange, market or
trading facility on which the Common Stock is or has been listed (or on which it
has been quoted) to the effect that the Company is not in compliance with the
listing or maintenance requirements of such exchange or market. The Company is
currently in compliance with all the listing and maintenance requirements of the
Boston Stock Exchange.
(o) Patents and Trademarks. The Company and its Subsidiaries have,
or have rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, licenses and rights which
are necessary or material for use in connection with their respective business
as described in the SEC Documents and which the failure to so have would have a
Material Adverse Effect (collectively, the "Intellectual Property Rights").
Neither the Company nor any Subsidiary has received a written notice that the
Intellectual Property Rights used by the Company or its Subsidiaries violates or
infringes upon the rights of any Person, to the best knowledge of the Company.
All such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights.
(p) Registration Rights; Rights of Participation. Except as
disclosed under Section 6(c) of the Registration Rights Agreement, the Company
has not granted or agreed to grant to any Person any rights (including
"piggy-back" registration rights) to have any securities of the Company
registered with the Commission or any other governmental authority which have
not been satisfied. No Person, has any right of first refusal, preemptive right,
right of participation, or any similar right to participate in the transactions
contemplated by the Transaction Documents.
(q) Regulatory Permits. The Company and its Subsidiaries possess
all certificates, authorizations and permits issued by the appropriate Federal,
state or foreign regulatory authorities necessary to conduct their respective
businesses as described in the SEC Documents, except where the failure to
possess such permits would not reasonably be expected to, individually or in the
aggregate, have or result in a Material Adverse Effect ("Material Permits"), and
neither the Company nor any Subsidiary has received any notice of proceedings
relating to the revocation or modification of any Material Permit.
(r) Title. The Company and the Subsidiaries have good and
marketable title in fee simple to all real property owned by them which is
material to the business of the Company and
7
its Subsidiaries and good and marketable title in all personal property owned by
them which is material to the business of the Company and its Subsidiaries, in
each case free and clear of all Liens, except for Liens as do not materially
affect the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its Subsidiaries. Any
real property and facilities held under lease by the Company and its
Subsidiaries are held by them under valid, subsisting and enforceable leases of
which the Company and its Subsidiaries are in compliance and do not interfere
with the use made and proposed to be made of such property and buildings by the
Company and its Subsidiaries.
(s) Absence of Certain Proceedings. Except as described in the SEC
Documents, (i) there is no Company Action pending or, to the knowledge of the
Company, threatened against the Company, in any such case wherein an unfavorable
decision, ruling or finding could have or result in a Material Adverse Effect;
(ii) neither the Company nor any Subsidiary, nor any director or officer
thereof, is or has been the subject of any Company Action involving (A) a claim
of violation of or liability under federal or state securities laws or (B) a
claim of breach of fiduciary duty; (iii) the Company does not have pending
before the Commission any request for confidential treatment of information and
the Company has no knowledge of any expected such request that would be made
prior to the Effectiveness Date (as defined in the Registration Rights
Agreement); and (iv) there has not been, and to the best of the Company's
knowledge there is not pending or contemplated, any investigation by the
Commission involving the Company or any current or former director or officer of
the Company.
(t) Labor Relations. No material labor problem exists or, to the
knowledge of the Company, is imminent with respect to any of the employees of
the Company.
(u) Exclusivity. So long as any Purchaser shall own either Bazaar
Shares or Shares, the Company shall not issue and sell in excess of 5,000 shares
of Preferred Stock to any Person other than the Purchasers without specific
prior written consent of the Purchasers.
(v) Disclosure. The Company confirms that neither it nor any other
Person acting on its behalf has provided any of the Purchasers or its agents or
counsel with any information that constitutes or might constitute material
non-public information. The Company understands and confirms that the Purchasers
shall be relying on the foregoing representations in effecting transactions in
securities of the Company. All disclosure provided to the Purchasers regarding
the Company, its business and the transactions contemplated hereby, including
the Schedules to this Agreement, furnished by or on behalf of the Company are
true and correct in all material respects and do not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in light of the circumstances under
which they were made, not misleading.
II.2 Representations and Warranties of the Purchasers. Each Purchaser
hereby for itself and for no other Purchaser represents and warrants to the
Company as follows:
8
(a) Organization; Authority. Such Purchaser is an entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization with the requisite corporate or partnership
power and authority to enter into and to consummate the transactions
contemplated by the Transaction Documents and otherwise to carry out its
obligations thereunder. The purchase by such Purchaser of the Securities
hereunder has been duly authorized by all necessary corporate action on the part
of such Purchaser. Each of this Agreement, the Pledge Agreement and the
Registration Rights Agreement has been duly executed by such Purchaser, and when
delivered by such Purchaser in accordance with the terms hereof, will constitute
the valid and legally binding obligation of such Purchaser, enforceable against
it in accordance with its terms.
(b) Investment Intent. Such Purchaser is acquiring the Securities
as principal for its own account for investment purposes only and not with a
view to or for distributing or reselling such Securities or any part thereof,
without prejudice, however, to such Purchaser's right, subject to the provisions
of this Agreement and the Registration Rights Agreement, at all times to sell or
otherwise dispose of all or any part of such Securities pursuant to an effective
registration statement under the Securities Act or under an exemption from such
registration and in compliance with applicable federal and state securities
laws. Nothing contained herein shall be deemed a representation or warranty by
such Purchaser to hold Securities for any amount of time. Such Purchaser is
acquiring the Securities hereunder in the ordinary course of its business. Such
Purchaser does not have any agreement or understanding, directly or indirectly,
with any Person to distribute any Securities.
(c) Purchaser Status. At the time such Purchaser was offered the
Securities, it was, and at the Closing Date it will be, an "accredited investor"
as defined in Rule 501(a) under the Securities Act.
(d) Experience of such Purchaser. Such Purchaser, either alone or
together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of evaluating
the merits and risks of the prospective investment in the Securities, and has so
evaluated the merits and risks of such investment. Such Purchasers has been
advised by counsel in connection with the transactions contemplates hereby.
(e) Ability of such Purchaser to Bear Risk of Investment. Such
Purchaser is able to bear the economic risk of an investment in the Securities
and, at the present time, is able to afford a complete loss of such investment.
(f) Access to Information. Such Purchaser acknowledges that it has
reviewed the Disclosure Materials and has been afforded: (i) the opportunity to
ask such questions as it has deemed necessary of, and to receive answers from,
representatives of the Company concerning the terms and conditions of the
offering of the Securities and the merits and risks of investing in the
Securities; (ii) access to information about the Company and the Company's
financial condition, results of operations, business, properties, management and
prospects sufficient to enable it to evaluate its investment; and (iii) the
opportunity to obtain such additional information which the Company possesses,
or can acquire without unreasonable effort or expense that is necessary to make
9
an informed investment decision with respect to the investment and to verify the
accuracy and completeness of the information contained in the Disclosure
Materials. Neither such inquiries nor any other investigation conducted by or on
behalf of such Purchaser or its representatives or counsel shall modify, amend
or affect such Purchaser's right to rely on the truth, accuracy and completeness
of the Disclosure Materials and the Company's representations and warranties
contained in the Transaction Documents.
(g) General Solicitation. Such Purchaser is not purchasing the
Securities as a result of or subsequent to any advertisement, article, notice or
other communication regarding the Securities published in any newspaper,
magazine or similar media or broadcast over television or radio or presented at
any seminar or any other general solicitation or general advertisement.
(h) Reliance. Such Purchaser understands and acknowledges that:
(i) the Securities are being offered and sold to it without registration under
the Securities Act in a private placement that is exempt from the registration
provisions of the Securities Act and (ii) the availability of such exemption,
depends in part on, and the Company will rely upon the accuracy and truthfulness
of, the foregoing representations and such Purchaser hereby consents to such
reliance.
The Company acknowledges and agrees that no Purchaser makes or has made
any representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in this Section 2.2.
ARTICLE III.
OTHER AGREEMENTS OF THE PARTIES
III.1 Transfer Restrictions. (i) Securities may only be disposed of
pursuant to an effective registration statement under the Securities Act, to the
Company or pursuant to an available exemption from or in a transaction not
subject to the registration requirements of the Securities Act, and in
compliance with any applicable federal and state securities laws. In connection
with any transfer of Securities other than pursuant to an effective registration
statement or to the Company, except as otherwise set forth herein, the Company
may require the transferor thereof to provide to the Company an opinion of
counsel selected by the transferor, the form and substance of which opinion
shall be reasonably satisfactory to the Company, to the effect that such
transfer does not require registration of such transferred Securities under the
Securities Act. Notwithstanding the foregoing, the Company, without requiring a
legal opinion as described in the immediately preceding sentence, hereby
consents to and agrees to register on the books of the Company and with any
transfer agent for the securities of the Company any transfer of Securities by a
Purchaser to an Affiliate of such Purchaser or to one or more funds or managed
accounts under common management with such Purchaser, and any transfer among any
such Affiliates or one or more funds or managed accounts, provided that the
transferee certifies to the Company that it is an "accredited investor" as
defined in Rule 501(a) under the Securities Act and that it is acquiring the
Securities solely for investment purposes (subject to the qualifications
hereof). Any such transferee shall agree in writing to be bound by the terms of
this Agreement and shall have the rights of a Purchaser under this Agreement and
the Registration Rights Agreement.
10
(ii) The Purchasers agree to the imprinting, so long as is
required by this Section 3.1(b), of the following legend on the Securities:
NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE
SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR
SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
The Underlying Shares shall not contain the legend set forth above
nor any other legend at any time while an Underlying Shares Registration
Statement is effective under the Securities Act or the holder of any such
security is relying on Rule 144 promulgated under the Securities Act ("Rule
144") in connection with the resale of such Underlying Shares or, in the event
there is not an effective Underlying Shares Registration Statement at such time
and Rule 144 is not then available, if, in the opinion of counsel to the
Company, such legend is not required under applicable requirements of the
Securities Act (including judicial interpretations and pronouncements issued by
the staff of the Commission). The Company shall cause its counsel to issue the
legal opinion included in the Transfer Agent Instructions to the Company's
transfer agent on the day that the Underlying Shares Registration Statement is
declared effective by the Commission (the "Effective Date"). The Company further
agrees that if any Underlying Shares are issued with a legend in accordance with
this Section 3.1(b), it will, within three (3) Trading Days after request
therefor by a Purchaser, provide such Purchaser with a certificate or
certificates representing such Underlying Shares, free from such legend at such
time as such legend would not have been required under this Section 3.1(b) had
such issuance occurred on the date of such request. The Company may not make any
notation on its records or give instructions to any transfer agent of the
Company which enlarge the restrictions of transfer set forth in this Section.
III.2 Acknowledgment of Dilution. The Company acknowledges that the
issuance of the Underlying Shares upon conversion of the Shares in accordance
with the terms of the Certificate of Designation, will result in dilution of the
outstanding shares of the Common Stock, which dilution may be substantial under
certain market conditions. The Company further acknowledges that its obligation
to issue Underlying Shares upon conversion of the Shares in accordance with the
terms of the Certificate of Designation, is unconditional and absolute, subject
to the limitations set forth herein, in the Certificate of Designation,
regardless of the effect of any such dilution.
III.3 Furnishing of Information. As long as the Purchasers own
Securities, the Company covenants to timely file (or obtain extensions in
respect thereof and file within the applicable grace
11
period) all reports required to be filed by the Company after the date hereof
pursuant to Section 13(a) or 15(d) of the Exchange Act. As long as the
Purchasers own Securities, if the Company is not required to file reports
pursuant to such sections, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) promulgated under the
Securities Act such information as is required for the Purchasers to sell the
Securities under Rule 144 promulgated under the Securities Act. The Company
further covenants that it will take such further action as any holder of
Securities may reasonably request, all to the extent required from time to time
to enable such Person to sell Underlying Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144
promulgated under the Securities Act, including causing its attorneys to render
and deliver any legal opinion required in order to permit a Purchaser to receive
Underlying Shares free of all restrictive legends and to subsequently sell
Underlying Shares under Rule 144 upon receipt of a notice of an intention to
sell or other form of notice having a similar effect. Upon the request of any
such Person, the Company shall deliver to such Person a written certification of
a duly authorized officer as to whether it has complied with such requirements.
III.4 Integration. The Company shall not, and shall use its best
efforts to ensure that, no Affiliate of the Company shall, sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in Section 2 of the Securities Act) that would be integrated with the
offer or sale of the Securities in a manner that would require the registration
under the Securities Act of the sale of the Securities to the Purchasers.
III.5 Increase in Authorized Shares. If on any date the Company would
be, if a notice of conversion were to be delivered on such date, precluded from
issuing 200% of the number of Underlying Shares as would then be issuable upon a
conversion in full of the Shares (the "Current Required Minimum"), due to the
unavailability of a sufficient number of authorized but unissued or reserved
shares of Common Stock, then the Board of Directors of the Company shall
promptly (and in any case, within 30 Business Days from such date) prepare and
mail to the stockholders of the Company proxy materials requesting authorization
to amend the Company's certificate or articles of incorporation to increase the
number of shares of Common Stock which the Company is authorized to issue to at
least such number of shares as reasonably requested by the Purchasers in order
to provide for such number of authorized and unissued shares of Common Stock to
enable the Company to comply with its issuance, conversion and reservation of
shares obligations as set forth in this Agreement and the Certificate of
Designation (the sum of (x) the number of shares of Common Stock then
outstanding plus all shares of Common Stock issuable upon exercise of all
outstanding options, warrants and convertible instruments, and (y) the Current
Required Minimum, is deemed for purposes hereof to be a reasonable number). In
connection therewith, the Board of Directors of the Company shall: (a) adopt
proper resolutions authorizing such increase, (b) recommend to and otherwise use
its best efforts to promptly and duly obtain stockholder approval to carry out
such resolutions (and hold a special meeting of the stockholders no later than
the earlier to occur of the 60th day after delivery of the proxy materials
relating to such meeting and the 90th day after request by a holder of
Securities to issue the number of Underlying Shares in accordance with the terms
hereof) and (c) within five Business Days of obtaining such stockholder
authorization, file an appropriate amendment to the Company's certificate or
articles of incorporation to evidence such increase. The Company shall also use
its best efforts to cause Company management to vote shares
12
of Common Stock held by Management in favor of all resolutions to increase the
authorized stock of the Company hereunder. Notwithstanding anything herein to
the contrary, no later than March 7, 2001, the Company shall have mailed to its
stockholders and filed with the Commission proxy materials requesting
authorization to amend the Company's certificate of incorporation to increase
the number of shares of Common Stock which the Company is authorized to issue to
200,000,000.
III.6 Reservation and Listing of Underlying Shares. The Company shall
(i) in the time and manner required by any exchange, market or quotation system
on which the Common Stock is traded, prepare and file with such securities
exchange or market or trading or quotation facility on which the Common Stock is
listed an additional shares listing application covering a number of shares of
Common Stock which is not less than the Initial Minimum, (ii) take all steps
necessary to cause such shares of Common Stock to be approved for listing on any
such securities exchange or market or trading or quotation facility as soon as
possible thereafter, and (iii) provide to the Purchasers evidence of such
listing, and the Company shall maintain the listing of its Common Stock thereon.
If the number of Underlying Shares issuable upon conversion in full of the then
outstanding Shares exceeds 85% of the number of Underlying Shares previously
listed on account thereof, then the Company shall take the necessary actions to
immediately list a number of Underlying Shares as equals no less than the then
Current Required Minimum. The Company shall maintain a reserve of shares of
Common Stock for issuance upon the conversion in full of the Shares in
accordance with this Agreement and the Certificate of Designation, respectively,
in such amount as may be required to fulfill its obligations in full under the
Transaction Documents, which reserve shall equal no less than the then Current
Required Minimum.
III.7 Conversion Procedures. The Transfer Agent Instructions and the
conversion notice pursuant to the Certificate of Designation set forth the
totality of the procedures with respect to the conversion of the Shares,
including the form of legal opinion, if necessary, that shall be rendered to the
Company's transfer agent and such other information and instructions as may be
reasonably necessary to enable the Purchasers to convert their Shares as
contemplated in the Certificate of Designation.
III.8 Conversion Obligations of the Company. The Company shall honor
conversion of the Shares and shall deliver Underlying Shares in accordance with
the respective terms, conditions and time periods set forth in the Certificate
of Designation.
III.9 Right of First Refusal; Subsequent Registrations. (i) The Company
shall not, directly or indirectly, without the prior written consent of
Purchasers holding a majority of the Bazaar Shares or Shares (as applicable),
offer, sell, grant any option to purchase, or otherwise dispose of (or announce
any offer, sale, grant or any option to purchase or other disposition) any of
its or its Affiliates' equity or equity-equivalent securities including the
issuance of any debt or other instrument at any time over the life thereof
convertible into or exchangeable for Common Stock, or any other transaction
intended to be exempt or not subject to registration under the Securities Act
(collectively, a "Subsequent Placement") during the period from the Execution
Date until the 180th day following the Effective Date, provided, that such 180
day period shall be extended for the number of Trading Days during such period:
(A) in which trading in the Common Stock is
13
suspended by any securities exchange or market or quotation system on which the
Common Stock is then listed, or (B) during which the Underlying Shares
Registration Statement is not effective, or (C) during which the prospectus
included in the Underlying Shares Registration Statement may not be used by the
holders thereof for the resale of Underlying Shares, unless: (A) the Company
delivers to each of the Purchasers a written notice (the "Subsequent Placement
Notice") of its intention to effect such Subsequent Placement, which Subsequent
Placement Notice shall describe in reasonable detail the proposed terms of such
Subsequent Placement, the amount of proceeds intended to be raised thereunder,
the Person with whom such Subsequent Placement shall be effected, and attached
to which shall be a term sheet or similar document relating thereto and (B) such
Purchaser shall not have notified the Company by 6:30 p.m. (New York City time)
on the seventh day after its receipt of the Subsequent Placement Notice of their
willingness to provide, subject to completion of mutually acceptable
documentation, financing to the Company in the amount and on the same terms set
forth in the Subsequent Placement Notice. If the Purchasers shall fail to notify
the Company of their intention to enter into such negotiations within such time
period, the Company may effect the Subsequent Placement substantially upon the
terms and to the Persons (or Affiliates of such Persons) set forth in the
Subsequent Placement Notice, provided, that the Company shall provide the
Purchasers with a second Subsequent Placement Notice, and the Purchasers shall
again have the right of first refusal set forth above in this paragraph (a), if
the Subsequent Placement subject to the initial Subsequent Placement Notice
shall not have been consummated for any reason on the terms set forth in such
Subsequent Placement Notice within thirty Trading Days after the date of the
initial Subsequent Placement Notice with the Person (or an Affiliate of such
Person) identified in the Subsequent Placement Notice. If the Purchasers shall
indicate a willingness to provide financing in excess of the amount set forth in
the Subsequent Placement Notice, then each Purchaser shall be entitled to
provide financing pursuant to such Subsequent Placement Notice up to an amount
equal to such Purchaser's pro-rata portion of the aggregate number of Bazaar
Shares purchased by such Purchaser, but the Company shall not be required to
accept financing from the Purchasers in an amount in excess of the amount set
forth in the Subsequent Placement Notice. The right of first refusal set forth
in this Section shall not apply to: (i) the granting of options or warrants to
employees, officers and directors, and the issuance of shares upon exercise of
options granted, under any stock option plan heretofore or hereinafter duly
adopted by the Company, (ii) shares of Common Stock issuable upon exercise of
any currently outstanding warrants and upon conversion of any currently
outstanding convertible securities of the Company, in each case as disclosed in
the SEC Documents, but not with respect to any amendment or modification
thereto, and (iii)Underlying Shares.
(ii) Except for (x) Underlying Shares, (y) other "Registrable
Securities" (as such term is defined in the Registration Rights Agreement) to be
registered, and securities of the Company permitted pursuant to Section 6(c) of
the Registration Rights Agreement to be registered, in the Underlying Shares
Registration Statement in accordance with the Registration Rights Agreement, and
(z) Common Stock permitted to be issued pursuant to paragraph (a)(i) - (iii) of
Section 3.9 (a), the Company shall not, for during the period from the Execution
Date until the 90th Trading Day following the Effective Date, without the prior
written consent of Purchasers holding a majority of the Bazaar Shares or Shares
(as applicable): (i) issue or sell any of its or any of its Affiliates' equity
14
or equity-equivalent securities pursuant to Regulation S promulgated under the
Securities Act, or (ii) register any securities of the Company. Any days after
the Effective Date that a Purchaser is unable to sell Underlying Shares under
the Underlying Shares Registration Statement shall be added to such 90 Trading
Day period.
III.10 Certain Securities Laws Disclosures; Publicity. The Company
shall: (i) on the Execution Date, issue a press release acceptable to the
Purchasers disclosing the transactions contemplated hereby and (ii) timely file
with the Commission a Form D promulgated under the Securities Act as required
under Regulation D promulgated under the Securities Act and provide a copy
thereof to the Purchasers promptly after the filing thereof. The Company shall,
no less than two Business Days prior to the filing of the Form D required by
clause (ii), provide a copy thereof to the Purchasers. The Company and the
Purchasers shall consult with each other in issuing any press releases or
otherwise making public statements or filings and other communications with the
Commission or any regulatory agency or stock market or trading facility with
respect to the transactions contemplated hereby and neither party shall issue
any such press release or otherwise make any such public statement, filings or
other communications without the prior written consent of the other, which
consent shall not be unreasonably withheld or delayed, except that no prior
consent shall be required if such disclosure is required by law, in which such
case the disclosing party shall provide the other party with prior notice of
such public statement, filing or other communication. Notwithstanding the
foregoing, the Company shall not publicly disclose the names of the Purchasers,
or include the names of the Purchasers in any filing with the Commission, or any
regulatory agency, trading facility or stock market without the prior written
consent of the Purchasers, except to the extent such disclosure (but not any
disclosure as to the controlling Persons thereof) is required by law, in which
case the Company shall provide the Purchasers with prior notice of such
disclosure.
III.11 Reimbursement. If any Purchaser becomes involved in any capacity
in any Action brought by or against any Person, including stockholders of the
Company, solely as a result of the acquisition of the Securities hereunder, the
Company will reimburse such Purchaser for its reasonable legal and other
expenses (including the cost of any investigation, preparation and travel in
connection therewith) incurred in connection therewith, as such expenses are
incurred. The reimbursement obligations of the Company under this paragraph
shall be in addition to any liability which the Company may otherwise have,
shall extend upon the same terms and conditions to any Affiliates of the
Purchasers who are actually named in such action, proceeding or investigation,
and partners, directors, agents, employees and controlling persons (if any), as
the case may be, of the Purchasers and any such Affiliate, and shall be binding
upon and inure to the benefit of any successors, assigns, heirs and personal
representatives of the Company, the Purchasers and any such Affiliate and any
such Person. The Company also agrees that neither the Purchasers nor any such
Affiliates, partners, directors, agents, employees or controlling persons shall
have any liability to the Company or any Person asserting claims on behalf of or
in right of the Company solely as a result of the acquisition of the Securities
hereunder.
15
ARTICLE IV.
MISCELLANEOUS
IV.1 Fees and Expenses. Except as otherwise set forth in the
Registration Rights Agreement, each party shall pay the fees and expenses of its
advisers, counsel, accountants and other experts, if any, and all other expenses
incurred by such party incident to the negotiation, preparation, execution,
delivery and performance of this Agreement. The Company shall pay all stamp and
other taxes and duties levied in connection with the issuance of the Securities.
IV.2 Entire Agreement; Amendments. The Transaction Documents, together
with the Exhibits and Schedules thereto and the Transfer Agent Instructions
contain the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or
written, with respect to such matters, which the parties acknowledge have been
merged into such documents, exhibits and schedules.
IV.3 Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of (i) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile
telephone number specified in this Section prior to 6:30 p.m. (New York City
time) on a Business Day, (ii) the Business Day after the date of transmission,
if such notice or communication is delivered via facsimile at the facsimile
telephone number specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the Business Day following the date of mailing, if sent by nationally
recognized overnight courier service, or (iv) upon actual receipt by the party
to whom such notice is required to be given. The address for such notices and
communications shall be as follows:
If to the Company: DynaGen, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
With copies to: ▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
If to a Purchaser: To the address set forth under such
Purchaser's name on the signature pages
hereto;
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
16
IV.4 Amendments; Waivers. No provision of this Agreement may be waived
or amended except in a written instrument signed, in the case of an amendment,
by the Company and each of the Purchasers or, in the case of a waiver, by the
party against whom enforcement of any such waiver is sought. No waiver of any
default with respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future or a waiver of
any other provision, condition or requirement hereof, nor shall any delay or
omission of either party to exercise any right hereunder in any manner impair
the exercise of any such right accruing to it thereafter.
IV.5 Headings. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.
IV.6 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted assigns.
The Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Purchasers. Except as set forth in
Section 3.1(a), the Purchasers may not assign this Agreement or any of the
rights or obligations hereunder without the consent of the Company. This
provision shall not limit any Purchaser's right to transfer securities or
transfer or assign rights under the Registration Rights Agreement.
IV.7 No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.
IV.8 Governing Law. The corporate laws of the State of Delaware shall
govern all issues concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein (including with respect to
the enforcement of any of the Transaction Documents), and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.
IV.9 Survival. The representations, warranties, agreements and
covenants contained herein shall survive the Closing and the delivery and
conversion of the Shares.
17
IV.10 Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
IV.11 Severability. In case any one or more of the provisions of this
Agreement shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affecting or impaired thereby and the parties will attempt to
agree upon a valid and enforceable provision which shall be a reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Agreement.
IV.12 Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, each of the
Purchasers will be entitled to specific performance of the obligations of the
Company under the Transaction Documents. The Company and each of the Purchasers
agree that monetary damages may not be adequate compensation for any loss
incurred by reason of any breach of its obligations described in the foregoing
sentence and hereby agrees to waive in any action for specific performance of
any such obligation the defense that a remedy at law would be adequate.
IV.13 Independent Nature of Purchasers' Obligations and Rights. The
obligations of each Purchaser under any Transaction Document is several and not
joint with the obligations of any other Purchaser and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser under any Transaction Document. Nothing contained herein or in any
Transaction Document, and no action taken by any Purchaser pursuant thereto,
shall be deemed to constitute the Purchasers as a partnership, an association, a
joint venture or any other kind of entity, or create a presumption that the
Purchasers are in any way acting in concert with respect to such obligations or
the transactions contemplated by the Transaction Document. Each Purchaser shall
be entitled to independently protect and enforce its rights, including without
limitation the rights arising out of this Agreement or out of the other
Transaction Documents, and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOLLOWS]
18
IN WITNESS WHEREOF, the parties hereto have caused this Exchange and
Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.
DYNAGEN, INC.
By:____________________________
Name:
Title:
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
KENILWORTH LLC
By:____________________________
Name:
Title:
Address for Notice: Kenilworth LLC
▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (▇▇▇▇▇▇) Limited
Commercial Centre
P.O. Box 31106 SMB
Grand Cayman
Cayman Islands
British West Indies
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇ and (▇▇▇)▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
THE ENDEAVOUR CAPITAL INVESTMENT FUND S.A.
By:____________________________
Name:
Title:
Address for Notice: The Endeavour Capital Investment Fund S.A.
c/o Lion Corporate Services
Cumberland House
#▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇-▇▇▇▇▇
Nassau, The Bahamas
Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
With copies to: Endeavour Advisers Ltd.
▇.▇.▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ 91570
Yirmeyahu ▇▇. ▇▇/▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇-▇) ▇▇▇-▇▇▇▇/9
With copies also to: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇)▇▇▇-▇▇▇▇ and (▇▇▇)▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.