NEURO-HITECH, INC. SECURITIES PURCHASE AGREEMENT
NEURO-HITECH,
INC.
This
SECURITIES PURCHASE AGREEMENT (this “Agreement”)
is
entered into as of November 16, 2006 (the “Execution
Date”),
by
and among NEURO-HITECH, INC., a Delaware corporation (the “Company”),
and
the investors listed on Schedule
A
(individually, an “Investor”
and
collectively the “Investors”).
1. Authorization
and Sale of Shares and Warrants.
1.1 Authorization
of Shares and Warrants.
The
Company has authorized the issuance and sale, in accordance with the terms
hereof, of (a) up to 1,814,634 shares (the “Shares”)
of
Common Stock, $0.001 per value (“Common
Stock”)
and
(b) Warrants, substantially in the form attached hereto as Exhibit
A
(the
“Warrants”
and,
together at times with the Shares, the “Securities”),
for
the purchase of an amount
of up to
907,317 shares of Common Stock (the “Warrant
Shares”).
1.2 Sale
of Securities.
Subject
to the terms and conditions of this Agreement, at each Closing (as defined
below), each Investor agrees, severally, and not jointly, to purchase, and
the
Company agrees to sell and issue to each such Investor at such Closing, (a)
the
number of Shares set forth opposite such Investor’s name on Schedule
A
hereto
under the heading “Number of Shares Purchased” and (b) a Warrant exercisable for
the number of Warrant Shares set forth opposite such Investor’s name on Schedule
A hereto under the heading “Amount of Warrant Shares”, all for a purchase price
(the “Purchase
Price”)
equal
to the greater of $5.125 per share or a 20% discount to the average market
price
per share of the Common Stock for the 20 trading days preceding the Initial
Closing (as hereinafter defined).
1.3 The
Closing.
(a) The
purchase and sale of the Securities hereunder shall take place at one or more
closings (each a “Closing”).
The
initial closing (the “Initial
Closing”),
shall
take place at the offices of Manatt, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, LLP, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, concurrent with the closing of the Q-RNA Merger
(as defined below), or at such other time as the Company and a majority in
interest of the Investors participating in the Initial Closing (the
“Initial
Investors”)
mutually agree upon orally or in writing (the “Closing
Date”).
(b) Any
Securities not issued and sold at the Initial Closing may be issued and sold,
subject to the terms and conditions of this Agreement, at one or more subsequent
Closings (each a “Subsequent Closing”), to one or more persons acceptable to the
Company (the “Subsequent
Investors”).
Any
such sale and issuance at a Subsequent Closing shall be on the same terms and
conditions (including the Purchase Price that shall have been fixed at the
Initial Closing). Upon execution and delivery of the relevant signature pages,
the Subsequent Investors shall be become parties to, and bound by, this
Agreement and the other Transaction Documents (as hereinafter defined), without
the need for any amendment to any such Transaction Documents except to add
such
person’s or entity’s name to the appropriate exhibit or schedule to such
agreements, and shall have the rights and obligations hereunder and thereunder,
in each case as of the applicable Subsequent Closing. Each Subsequent Closing
shall take place at such date, time and place as shall be approved by the
Company. Immediately after each Subsequent Closing, Schedule
A
hereto
will be amended to list the Investors purchasing Securities hereunder and the
amount of Securities issued to such Investor at such Subsequent Closing. The
Company will furnish to each Investor copies of the amended Schedule
A
referred
to in the preceding sentence.
(c)
At each
Closing, the Company shall deliver to each Investor certificates representing
the Shares and Warrant being purchased by such Investor at such Closing, against
payment of the applicable Purchase Price therefor by check, wire transfer,
cancellation or conversion of indebtedness, or any combination
thereof.
1.4 Escrow.
(a) Following
the date of this Agreement, the Company intends to establish an escrow
arrangement with US Bank National Association or another banking institution
reasonably acceptable to the Initial Investors (the “Escrow
Agent”),
which
arrangement shall be in form and substance reasonably satisfactory to the
Company and the Initial Investors and providing, among other things, for the
release from escrow of the aggregate Purchase Price paid by the Initial
Investors hereunder (a) to the Company, if the conditions set forth in Section
5
below shall have been satisfied or unanimously waived prior to the Termination
Date (as hereinafter defined) or (b) to the Initial Investors, upon any other
circumstance. Following the execution and delivery of this Agreement, the
Company and the Initial Investors shall use reasonable commercial efforts to
finalize such arrangement and, promptly thereafter (but prior to the Initial
Closing), the Investors shall fund their respective investment amounts into
such
escrow.
(b) Following
the Initial Closing, additional Investors may fund their respective investment
amounts into such escrow, and the Purchase Price paid by each such additional
Investor shall be released (a) to the Company, if the conditions set forth
in
Section 5 below shall have been satisfied or waived by such Investor to prior
to
the termination date with respect to such subscription or (b) to such Investor,
upon any other circumstance.
2. Adjustments
to Shares
2.1 Calculation.
If,
during the period beginning on the date of execution of this Agreement (the
“Execution
Date”)
and
ending immediately following the consummation by the Company of an Additional
Financing (as defined below), the Company issues any Additional Stock (as
defined below) without consideration or for a consideration per share less
than
the Adjusted Purchase Price (as defined below) in effect immediately prior
to
the issuance of such Additional Stock (each, a “Dilutive
Issuance”),
the
Company shall issue to each Investor a number of additional shares of Common
Stock (“Additional
Investor Shares”)
calculated as follows:
AS
=
(PP1*CS
▇
▇▇▇)-
CS
2
For
purposes of the foregoing formula, the following definitions shall apply:
(i) "PP2"
shall
mean the Adjusted Purchase Price at which Additional Stock shall be sold in
such
Dilutive Issuance;
(ii) "PP1"
shall
mean the Adjusted Purchase Price in effect immediately prior to such Dilutive
Issuance;
(iii) "CS"
shall mean the number of Shares that had been issued and sold to such Investor
pursuant to this Agreement at PP1
(without
accounting for any Warrant Shares that may be issued or issuable at such time
to
such Investor); and
(iv) "AS"
shall mean the number of Additional Investor Shares to be issued to such
Investor pursuant to this Section 2.
No
adjustment of the Adjusted Purchase Price will be made in an amount less than
one tenth of one cent per share $0.001), provided that any adjustments that
are
not required to be made by reason of this sentence will be carried forward
and
shall be taken into account in any subsequent adjustment made pursuant to this
Section 2. Except to the limited extent provided for in Section 2.4, no
adjustment of the Adjusted Purchase Price pursuant to this Section 2.1 shall
have the effect of increasing such Adjusted Purchase Price above the Adjusted
Purchase Price in effect immediately prior to such adjustment.
2.2 Options,
Warrants, Etc.
The
following provisions shall apply with respect to calculations of the number
of
Additional Investor Shares to be issued in the case of issuances by the Company
(whether on or after the Execution Date) of warrants, options to purchase or
rights to subscribe for Common Stock, securities by their terms convertible
into
or exchangeable for Common Stock or warrants, options to purchase or rights
to
subscribe for such convertible or exchangeable securities:
(a) The
aggregate maximum number of shares of Common Stock deliverable upon exercise
(assuming the satisfaction of any conditions to exercisability, including,
without limitation, the passage of time),
of
such warrants, options to purchase or rights to subscribe for Common Stock
will
be deemed to have been issued at the time such warrants, options or rights
were
issued and for a consideration equal to the consideration, if any, received
by
the Company upon the issuance of such warrants, options or rights plus the
minimum exercise price provided in such warrants, options or rights for the
Common Stock covered thereby.
(b) The
aggregate maximum number of shares of Common Stock deliverable upon conversion
of, or in exchange (assuming the satisfaction of any conditions to
convertibility or exchangeability, including, without limitation, the passage
of
time),
for
any such convertible or exchangeable securities or upon the exercise of options
to purchase or rights to subscribe for such convertible or exchangeable
securities and subsequent conversion or exchange thereof will be deemed to
have
been issued at the time such securities were issued or such options or rights
were issued and for a consideration equal to the consideration, if any, received
by the Company for any such securities and related options or rights (excluding
any cash received on account of accrued interest or accrued dividends), plus
the
minimum additional consideration, if any, to be received by the Company upon
the
conversion or exchange of such securities or the exercise of any related options
or rights.
3
(c) In
the
event of any change in the number of shares of Common Stock deliverable or
in
the consideration payable to the Company upon exercise of such options or rights
or upon conversion of or in exchange for such convertible or exchangeable
securities, including, but not limited to, a change resulting from antidilution
protections, the Adjusted Purchase Price, to the extent in any way affected
by
or computed using such options, rights or securities, will be recomputed to
reflect such change, but no further adjustment will be made for the actual
issuance of Common Stock or any payment of such consideration upon the exercise
of any such options or rights or the conversion or exchange of such
securities.
2.3 Definitions.
As used
herein, the following terms shall have the following meanings:
(a) “Additional
Financing”
means
the issuance or sale by the Company (or, in accordance with this Section 2,
the
deemed issuance and sale by the Company) of shares of Common Stock, whether
pursuant to this Agreement or otherwise, until the aggregate consideration
paid
(or, in accordance with this Section 2, deemed to be paid) to the Company,
from
and after the Initial Closing, shall exceed (x) $9,300,000 less (y) the
aggregate Purchase Price paid by the Investors for the Securities hereunder
at
the Initial Closing.
(b) “Additional
Stock”
means
any shares of Common Stock issued (or deemed to have been issued pursuant to
Section 2.2 above) by the Company after the Execution Date other
than:
(i) shares
of
Common Stock issued pursuant to a transaction described in Section 2.4
below;
(ii) shares
of
Common Stock issued or issuable to employees, officers, directors and
consultants of the Company directly or pursuant to the Company’s 2005 Incentive
Stock Plan, the Company’s 2005 Non-Employee Directors Stock Option Plan, the
Q-RNA, Inc. 2002 Stock Incentive Plan;
(iii) shares
of
Common Stock issuable to ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ pursuant to that certain Option
Agreement dated as of July 18, 2005 between Q-RNA, Inc. and ▇▇. ▇▇▇▇▇▇ as
adjusted pursuant to the Q-RNA Merger Agreement;
(iv) shares
of
Common Stock issued pursuant to the conversion, exchange or exercise of any
convertible or exercisable securities outstanding as of the Execution
Date;
(v) shares
of
Common Stock issued or issuable pursuant to the Q-RNA Merger (as defined below);
or
(vi) shares
of
Common Stock issuable pursuant to Section 1.2(b) of the Company’s Registration
Rights Agreement dated January 5, 2006 (the “Prior
Registration Rights Agreement”).
(c) “Adjusted
Purchase Price”
means,
initially, the Purchase Price, and thereafter as adjusted pursuant to the
provisions of this Section 2.
4
2.4 Stock
Splits, Combinations, Etc.
In the
event the Company should at any time or from time to time after the Execution
Date fix a record date for the effectuation of a split or subdivision of the
outstanding shares of Common Stock or the determination of holders of Common
Stock entitled to receive a dividend or other distribution payable in additional
shares of Common Stock or other securities or rights convertible into,
exchangeable for, or entitling the holder thereof to receive directly or
indirectly, additional shares of Common Stock (the “Common
Stock Equivalents”)
without payment of any consideration by such holder for the additional shares
of
Common Stock or the Common Stock Equivalents (including the additional shares
of
Common Stock issuable upon conversion or exercise thereof), then, as of such
record date (or the date of such dividend distribution, split or subdivision
if
no record date is fixed), the Adjusted Purchase Price will be appropriately
decreased to reflect the proportionate increase in the number of Shares deemed
issued to the Investors pursuant to this Agreement, provided,
however,
that if
such record date is fixed and such dividend is not paid or if such distribution
is not fully made on the date fixed therefor, the Adjusted Purchase Price will
be re-computed accordingly as of the close of business on such record date
and
thereafter each such Adjusted Purchase Price will be adjusted pursuant to this
Section 2(d) to reflect the actual payment of such dividend or
distribution. If
the
number of shares of Common Stock outstanding at any time after the Execution
Date is decreased by a combination of the outstanding shares of Common Stock,
then, following the record date of such combination, the applicable Adjusted
Purchase Price will be appropriately increased to reflect the proportionate
reduction in the number of Shares deemed issued the Investors pursuant to this
Agreement.
2.5 Recapitalizations.
If
at any
time or from time to time there shall be a recapitalization of the Common Stock
(other than the Q-RNA Merger or a subdivision, combination or merger or sale
of
assets transaction provided for elsewhere in this Section 2), appropriate
adjustment shall be made in the application of the provisions of this
Section 2 with respect to the rights of the holders of Shares after the
recapitalization to the end that the provisions of this Section 2 (including
adjustment of the applicable Adjusted Purchase Price then in effect) shall
be
applicable after that event as nearly equivalent as may be
practicable.
2.6 Fractional
Shares; Certificate as to Adjustments.
(a) No
fractional shares will be issued upon any adjustment of the Adjusted Purchase
Price, and the number of shares of Common Stock to be issued as a result thereof
will be rounded to the nearest whole share.
(b) Upon
the
occurrence of each adjustment or readjustment of the Adjusted Purchase Price
pursuant to this Section 2, the Company, at its expense, will promptly
compute such adjustment or readjustment in accordance with the terms hereof
and
prepare and furnish to each Investor a certificate setting forth such adjustment
or readjustment and showing in detail the facts upon which such adjustment
or
readjustment is based.
3. Representations
and Warranties of the Company.
Except
as set forth on the Disclosure Letter delivered to the Investors (the
“Disclosure
Schedule”)
or the
Company Disclosure Package (as defined below), the Company hereby makes the
representations and warranties set forth in this Section 2. The Disclosure
Schedule shall be arranged in Sections and Subsections corresponding to the
numbered Sections and Subsections contained in this Section 2. The disclosures
in any Section of the Disclosure Schedule shall qualify (i) the corresponding
Subsection in this Section 2, and (ii) other Subsections in this Section 2
to
the extent it is reasonable from a reading of the disclosure (notwithstanding
the absence of a specific cross reference) that such disclosure is applicable
to
such other Subsections. Unless the context otherwise requires, references in
this Section 2 to the “Company” shall include all of the Company’s direct and
indirect subsidiaries.
5
3.1 Organization,
Good Standing and Qualification.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware, and has the corporate power and
authority to own, operate and lease its properties and to carry on its business
as now conducted and as presently proposed to be conducted by the Company in
its
SEC Filings. The Company is duly qualified to do business as a foreign
corporation and is in good standing in the State of New York and in every other
jurisdiction in which the failure so to qualify would have a material adverse
effect on the business, assets, condition (financial or otherwise) or prospects
of the Company (a “Company
Material Adverse Effect”).
3.2 Subsidiaries.
Except
as set forth in the Company Disclosure Package, the Company does not presently
own or control, directly or indirectly, any equity interest in any other
corporation, association, or other business entity.
3.3 Power,
Authorization and Validity.
(a) The
Company has the right, power, legal capacity and authority to enter into and
perform its obligations under this Agreement, the Warrants and the registration
rights agreement to be entered into with the Investors substantially in the
form
of Exhibit
B
annexed
hereto (the “Registration
Rights Agreement”
and
together with this Agreement and the Warrants, (collectively, the “Transaction
Documents”),
to
issue and sell the Securities and to issue and sell the Warrant Shares issuable
upon exercise of the Warrants. All corporate action on the part of the Company,
its officers, directors and stockholders necessary for the authorization,
execution and delivery of the Transaction Documents, the performance of all
obligations of the Company thereunder and the authorization (or reservation
for
issuance), sale and issuance of the Securities and the Warrant Shares has been
taken or will be taken prior to the Closing.
(b) This
Agreement and the other Transaction Documents are, or when executed by the
Company will be, valid and binding obligations of the Company enforceable in
accordance with their respective terms, except as to the effect, if any, of
(i)
applicable bankruptcy and other similar laws affecting the rights of creditors
generally, (ii) rules of law governing specific performance, injunctive relief
and other equitable remedies and (iii) the enforceability of provisions
requiring indemnification in connection with the offering, issuance or sale
of
securities.
(c) The
Shares that are being purchased by the Investors hereunder, when issued, sold
and delivered in accordance with the terms of this Agreement for the
consideration expressed herein, will be duly and validly issued, fully paid
and
nonassessable, and will be free of any liens or encumbrances imposed by or
through the Company, preemptive or similar contractual rights, including rights
of first refusal, in favor of the Company, and restrictions on transfer, other
than restrictions on transfer under this Agreement, the other Transaction
Documents and under applicable state and federal securities laws. The Warrant
Shares have been duly and validly reserved for issuance and, upon issuance
in
accordance with the terms of the Company’s certificate of incorporation as
amended (the “Charter”),
will
be duly and validly issued, fully paid and nonassessable, and will be free
of
any liens or encumbrances imposed by or through the Company, preemptive rights
or similar contractual rights, including rights of first refusal, in favor
of
the Company, and restrictions on transfer, other than restrictions on transfer
under this Agreement, the other Transaction Documents and under applicable
state
and federal securities laws.
6
3.4 No
Violation of Existing Agreements.
The
execution, delivery and performance by the Company of this Agreement and the
consummation of the transactions contemplated hereby have not and will not,
(i)
violate in any material respect any law or regulation to which the Company
or
any of its assets is subject; (ii) violate any provision of the Charter or
Bylaws of the Company; (iii) conflict with, result in a breach of, constitute
a
default under, result in the acceleration of, create in any party the right
to
accelerate, terminate, modify or cancel, or require any notice under any
material agreement or material instrument to which the Company is a party or
by
which any of the assets of the Company is bound; or (iv) result in the
imposition of any material lien, charge or encumbrance upon any of the assets
of
the Company.
3.5 Disclosure.
(a) The
Company has furnished the Investors with its annual report on Form 10-KSB for
its fiscal year ended December 31, 2005, its quarterly report on Form 10-QSB
for
its fiscal quarters ended March 31, 2006, June 30, 2006 and September 30, 2006,
and all other reports or documents required to be filed by the Company pursuant
to Section 13(a) or 15(d) of the 1934 Act since the filing of the most recent
quarterly report on Form 10-QSB (the “SEC
Filings”).
The
SEC Filings were filed on a timely basis (or the Company has received a valid
extension of such time of filing, and has filed any such SEC Filings prior
to
the expiration of any such extension). As of their respective dates, the SEC
Filings 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, as applicable, and none of the SEC Filings,
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 the light of the circumstances under which
they
were made, not misleading. circumstances under which they were made, not
misleading.
(b) The
SEC
Filings, the exhibits and schedules thereto, this Agreement, the exhibits and
schedules hereto, the Q-RNA Merger Agreement (as hereinafter defined) (including
the exhibits and schedules thereto) and any certificates or documents to be
delivered by the Company pursuant to this Agreement (collectively, the
“Company
Disclosure Package”),
when
taken together, do not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements contained
herein and therein, in light of the circumstances under which such statements
were made, not misleading. Additionally, the financial statements contained
in
the Company Disclosure Package fairly and accurately, in all material respects,
represent the financial condition of the Company at the respective dates
specified therein and the results of operation for the respective periods
specified therein in conformity with generally accepted accounting principles
applied on a consistent basis.
7
3.6 Liabilities.
The
Company, to its knowledge, has no material contingent liabilities, except
current liabilities incurred in the ordinary course of business and liabilities
disclosed in the SEC Filings or the Company Disclosure Package. The reserves
for
liabilities reflected on the latest balance sheet contained in the Company’s
most recent quarterly report have been established in accordance with generally
accepted accounting principles consistently applied in accordance with past
practices.
3.7 Capitalization
and Voting Rights.
(a) The
authorized capital of the Company will consist of the following immediately
prior to the Initial Closing (but after giving effect to the Q-RNA Merger)(as
defined below):
(i) 44,999,900
shares of Common Stock, $0.001 par value per share, 11,241,506 shares of which
are issued and outstanding,
(ii) 100
shares of Class A Common Stock, $0.001 par value per share, 100 shares of which
are issued and outstanding, and
(iii) 5,000,000
shares of Preferred Stock, $0.01 par value per share, none of which are issued
and outstanding.
(b) All
issued and outstanding shares of the Common Stock (i) have been duly
authorized and validly issued and are fully paid and nonassessable and
(ii) were issued in compliance with all applicable state and federal laws
concerning the issuance of securities.
(c) Other
than (i) the 1,600,000 shares of Common Stock reserved or to be reserved
pursuant to the Q-RNA Merger Agreement for issuance under the Company’s stock
option plans, (ii) shares which may be issued pursuant to the Q-RNA Merger
Documents and the Transaction Documents, (iii) other options and warrants
described in the Company Disclosure Package and (iv) shares of Common Stock
issuable pursuant to Section 1.2(b) of the Prior Registration Rights Agreement,
there are no outstanding options, warrants, rights (including conversion or
preemptive rights and rights of first refusal), proxy or stockholder agreements,
or arrangements or agreements of any kind for the purchase or acquisition from
the Company of any of its securities. Neither the offer, issuance or sale of
any
of the Securities, or the issuance of any of the Warrant Shares upon exercise
of
the Warrants, nor the consummation of any transaction contemplated hereby will
result in a change in the exercise or conversion price or number of any
securities of the Company outstanding pursuant to anti-dilution or other similar
provisions binding upon the Company and contained in or affecting any such
securities.
3.8 Third-Party
Consents.
No
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or local
governmental authority or any other third party on the part of the Company
is
required in connection with the consummation of the transactions contemplated
by
this Agreement and the other Transaction Documents, except for such filings
as
are required pursuant to applicable federal and state securities laws and blue
sky laws.
8
3.9 Offering.
Subject
to the truth and accuracy of each Investor’s representations set forth in
Section 4 of this Agreement, the offer, sale and issuance of the Securities
as
contemplated by this Agreement are exempt from the registration requirements
of
the Securities Act of 1933, as amended (the “Securities
Act”),
and
the qualification or registration requirements of applicable state blue sky
laws. Neither the Company nor any authorized agent acting on its behalf has
taken any action that would cause the loss of such exemptions. Neither
the Company, nor any of its affiliates, nor any person acting on its or their
behalf, has directly or indirectly made any offers or sales of any security
or
solicited any offers to buy any security under circumstances that would cause
the offering of the Securities pursuant to this Agreement to be integrated
with
prior offerings by the Company for purposes of the Securities Act which would
prevent the Company from selling the Securities pursuant to Rule 506 under
the Securities Act, or require stockholder approval under any applicable
stockholder approval provisions of any exchange or trading market on which
any
of the securities of the Company are listed or designated.
3.10 Company
Intellectual Property.
(a) The
Company Disclosure Package sets forth true and correct lists of:
(i) all
patents and patent applications;
(ii) all
trademark registrations (including Internet domain name registrations) and
pending trademark applications; and
(iii) all
copyright registrations and pending copyright applications owned by the Company
or that the Company has licensed and that is material to the business of the
Company, as of the date of this Agreement (collectively, “Company
Registered Intellectual Property”).
All
of the Company Registered Intellectual Property is valid, subsisting, in full
force and effect (except with respect to applications), and has not expired
or
been canceled or abandoned.
(b) There
is
no pending or, to the knowledge of the Company, threatened (and at no time
within the two years prior to the date of this Agreement has there been pending
any) Action before any court, government agency or arbitral tribunal in any
jurisdiction challenging the use, ownership, validity, enforceability or
registrability of any of the Company Registered Intellectual Property. Neither
the Company, nor to the knowledge of the Company, any of its licensors, is
a
party to any settlements, covenants not to ▇▇▇, consents, decrees, stipulations,
judgments or orders resulting from proceedings, claims, actions or
investigations (“Actions”)
which
permit third parties to use any of the Company Registered Intellectual
Property.
(c) The
Company owns, or has valid rights to use, all of the Intellectual Property
used
in the business of the Company as currently conducted and as presently proposed
to be conducted by the Company in its SEC Filings.
(d) The
owned
Company Registered Intellectual Property does not unlawfully infringe and,
to
the knowledge of the Company no other Company Registered Intellectual Property
unlawfully infringes, upon any Intellectual Property or other proprietary right
owned by any third party.
9
(e) To
the
Company’s knowledge, no third party is misappropriating, infringing or violating
any Intellectual Property owned by, or licensed to, the Company that is material
to the business of the Company as currently conducted or as presently proposed
to be conducted by the Company in its SEC Filings, and no Intellectual Property
or other proprietary right misappropriation, infringement or violation Actions
have been brought against any third party by the Company which remain
unresolved.
(f) There
is
no pending or, to the knowledge of the Company, threatened (and at no time
within the two years prior to the date of this Agreement has there been pending
any) Action alleging that the activities or the conduct of the Company’s
business dilutes, misappropriates, infringes, violates or constitutes the
unauthorized use of, or will dilute, misappropriate, infringe upon, violate
or
constitute the unauthorized use of the Intellectual Property of any third party.
The Company is not party to any settlements, covenants not to ▇▇▇, consents,
decrees, stipulations, judgments, or orders resulting from any Action which
(i)
restricts the Company’s rights to use any Intellectual Property, (ii) restricts
the Company’s business in order to accommodate a third party’s Intellectual
Property or (iii) requires any future payment by the Company.
(g) The
Company requires each new relevant employee to execute a noncompetition,
nonsolicitation, nondisclosure and developments agreement in the Company’s
standard form. Other than under an appropriate confidentiality or nondisclosure
agreement or contractual provision relating to confidentiality and
nondisclosure, there has been no disclosure to any third party of material
confidential information or trade secrets of the Company related to any material
proprietary product being marketed, sold, licensed or developed by the Company
(each such product, “Proprietary
Product”).
All
employees of the Company who have made material contributions to the development
of any Proprietary Product have signed noncompetition, nonsolicitation,
nondisclosure and developments agreements. All consultants and independent
contractors who have made material contributions to the development of any
Proprietary Product have entered into a work-made-for-hire agreement or have
otherwise assigned to the Company (or a third party that previously conducted
any business currently conducted by the Company and that has assigned its rights
in such Proprietary Product to the Company) all of their right, title and
interest (other than moral rights, if any) in and to the portions of such
Proprietary Product developed by them in the course of their work for the
Company. Assignments of the patents, patent applications, copyrights and
copyright applications of the Company to the Company have been duly executed
and
filed with the United States Patent and Trademark Office or Copyright Office,
as
applicable.
(h) The
Company is not in material violation of any agreement, contract or binding
commitment (“Contract”)
to
which the Company is party or otherwise bound, nor will the consummation by
the
Company of the transactions contemplated hereby, resulting in any material
violation, loss or impairment of ownership by the Company of, or the right
of
the Company to use, any Intellectual Property that is material to the business
of the Company as currently conducted, nor require the consent of any
Governmental Authority or third party with respect to any such Intellectual
Property. The Company is not a party to any Contract under which a third party
would have or would be entitled to receive a license or any other right to
any
Intellectual Property of the Company or any of the Company’s affiliates as a
result of the consummation of the transactions contemplated by this Agreement
nor would the consummation of such transactions result in the amendment or
alteration of any such license or other right which exists on the date of this
Agreement.
10
(i) For
purposes of this Agreement, “Intellectual
Property”
shall
mean trademarks, service marks, trade names, slogans, logos, trade dress,
internet domain names and other similar designations of source or origin,
together with all goodwill, registrations and applications related to the
foregoing; patents, utility, models and industrial design registrations or
applications (including without limitation any continuations, divisionals,
continuations-in-part, provisionals, renewals, reissues, re-examinations and
applications for any of the foregoing); copyrights and copyrightable subject
matter (including without limitation any registration and applications for
any
of the foregoing, but excluding any off-the-shelf software); mask works rights
and trade secrets and other confidential information, know-how, proprietary
processes, formulae, algorithms, models, and methodologies; and computer
programs (whether in source code, object code or other form) in each case used
in or necessary for the conduct of the business of the party making such
representation, as currently conducted and as planned to be conducted, whether
such Intellectual Property is owned by such party or a third party.
3.11 Litigation.
There
is
no Action pending or, to the Company’s knowledge, threatened against or
affecting the Company, at law or in equity, or before or by any federal, state,
municipal or other governmental department, commission, board, bureau, agency
or
instrumentality, domestic or foreign that (i) prevents the Company from entering
into this Agreement or the other Transaction Documents, or from consummating
the
transactions contemplated hereby and thereby, or (ii) if adversely determined,
would reasonably be expected to have a Company Material Adverse Effect, and
to
the Company’s knowledge there is no basis for any of the foregoing. The Company
is not party to or subject to the provisions of any order, writ, injunction
or
decree known to or served upon the Company of any court or of any Federal,
state, municipal or other governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign. There is no Action or suit
by
the Company pending, threatened or contemplated against others except for such
failures or non-compliances would not reasonably be expected to have a Company
Material Adverse Effect.
3.12 Compliance
with Law.
The
Company has complied in all material respects with all laws, rules, regulations
and orders applicable to its business, operations, properties, assets, products
and services, including without limitation all applicable laws relating to
the
employment of labor, including provisions relating to wages, hours, equal
opportunity, collective bargaining and the payment of Social Security and other
taxes except for such failures or non-compliances would not reasonably be
expected to have a Company Material Adverse Effect. The Company has all permits,
licenses and other authorizations required to conduct its business as currently
conducted, and the Company has been operating its business pursuant to and
in
compliance in all respects with the terms of all such permits, licenses and
other authorizations except for such failures or non-compliances would not
reasonably be expected to have a Company Material Adverse Effect.
The
Company is in compliance with any and all applicable requirements of the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 that are effective as of the date hereof, and any
and
all applicable rules and regulations promulgated by the SEC thereunder that
are
effective as of the date hereof.
11
3.13 Title
to Properties.
The
Company has good and valid title to its owned properties and assets, including,
without limitation, its Intellectual Property, and all such properties and
assets are free and clear of all mortgages, pledges, security interests, liens,
charges, claims, restrictions and other encumbrances, (“Liens”)
except
for (a) liens for or current taxes not yet due and payable and (b) minor
imperfections of title, if any, not material in nature or amount and not
materially detracting from the value or impairing the use of the property
subject thereto or impairing the operations or proposed operations of the
Company including, without limitation, the ability of the Company to secure
financing using such properties and assets as collateral (“Permitted
Liens”).
3.14 Taxes.
The
Company has timely filed all tax returns, federal, state, county and local,
if
any, required to be filed by it, which returns are true and correct in all
material respects, and the Company has paid all taxes or assessments, if any,
shown to be due by such returns as well as all other taxes, assessments and
governmental charges which have become due or payable, including, without
limitation, all taxes which the Company is obligated to withhold from amounts
owing to employees, creditors and third parties. The Company has not been
advised (i) that any of its returns, federal, foreign, state or other, have
been
or are being audited as of the date hereof; or (ii) of any deficiency in
assessment or proposed judgment to its federal, state or other taxes. The
Company has no knowledge of any liability of any tax to be imposed upon its
properties or assets as of the date of this Agreement that is not adequately
provided for. No
tax
return of the Company has been audited by the Internal Revenue Services or
any
state taxing authority.
3.15 Other
Agreements.
(a) Except
as
set forth on the Disclosure Schedule, as filed as exhibits to any of the
Company’s SEC Reports or set forth in the Company Disclosure Package, there are
no Contracts, judgments, orders, writs or decrees to which the Company is a
party or to its knowledge by which it is bound which may involve (i) obligations
(contingent or otherwise) of, or payments to, the Company in excess of $50,000
(other than those arising from agreements entered into in the ordinary course
of
business and not involving obligations (contingent or otherwise) of, or payments
to, the Company in excess of $50,000 individually or $100,000 in the aggregate),
(ii) the transfer or license of any patent, copyright, trade secret, trademark,
service ▇▇▇▇, domain name or other proprietary right or intangible to or from
the Company (other than licenses arising from the purchase of “off the shelf” or
other standard products), (iii) provisions restricting the development,
manufacture or distribution of the Company’s products or services, or otherwise
affecting the Company’s ability to engage in a particular business or with a
particular party, (iv) indemnification by the Company with respect to
infringements of proprietary rights (other than indemnification obligations
arising from and incidental to purchase or sale or license agreements entered
into in the ordinary course of business, the terms of which have been disclosed
to the Investors and their counsel), (v) distributor, dealer, manufacturer’s
representative, service or sales agency agreements which are not terminable
on
less than 30 days’ notice without cost or other liability to the Company, (vi)
agreements with respect to the transfer or pledge of any securities of the
Company, or (vii) agreements providing for acceleration of any benefit, penalty
or ability of the other party thereto to terminate its obligations pursuant
thereto in the event of a change of control of the Company. Any agreement
referred to in the foregoing clauses (i) - (vii) is hereunder referred to as
a
“Material
Agreement.”
12
3.16 Dividends,
Loans and Advances.
Except
as set forth in the Company Disclosure Package, since September 30, 2006, the
Company (i) has not declared or paid any dividends or authorized or made any
distribution upon or with respect to any class or series of its capital stock;
and (ii) incurred any indebtedness for money borrowed or any other liabilities
(other than ordinary course obligations) individually in excess of $50,000
or,
in the case of indebtedness and/or liabilities individually less than $50,000,
in excess of $100,000 in the aggregate, (iii) made any loans or advances to
any
person not in excess, individually or in the aggregate, of $50,000, other than
ordinary advances for travel expenses, or (iv) sold, exchanged or otherwise
disposed of any of its rights or assets, other than in the ordinary course
of
business.
3.17 Brokers.
Neither
the Company nor any of its representatives has any contract, arrangement or
understanding with any broker, finder or similar agent with respect to the
transactions contemplated by this Agreement.
3.18 Transactions
With Related Parties.
There
are no obligations of the Company to officers, directors, or employees of the
Company other than (a) for payment of salary for services rendered and for
bonus
payments, (b) reimbursement for reasonable expenses incurred on behalf of the
Company, (c) for employee benefits made available to employees or groups of
employees (including stock option agreements outstanding under any stock option
plan approved by the Board of Directors of the Company) and (d) obligations
listed in the Company’s financial statements or disclosed in the Company
Disclosure Package. Except as disclosed in the Company Disclosure Package,
none
of the officers, directors or key employees of the Company or any members of
their immediate families, are indebted to the Company, individually or in the
aggregate, in excess of $50,000 or have any direct or indirect ownership
interest in any firm or corporation with which the Company is affiliated or
with
which the Company has a business relationship, or any firm or corporation which
competes with the Company, other than passive investments in publicly traded
companies (representing less than 1% of such company) which may compete with
the
Company. Except as described above, no officer or director, or any member of
their immediate families, is, directly or indirectly, interested in any material
contract with the Company and no agreements, understandings or proposed
transactions are contemplated between the Company and any such person. The
Company is not a guarantor or indemnitor of any indebtedness of any other
person, firm or corporation other than guaranties of obligations of any of
the
Subsidiaries.
3.19 Changes.
Since
September 30, 2006, except as set forth on the Disclosure Schedule to this
Agreement or as described in the Company Disclosure Package, there has not
been:
(a) Any
change in the assets, liabilities, financial condition, prospects or operations
of the Company, other than changes, whether or not in the ordinary course of
business, which individually or in the aggregate has not had or would not
reasonably be expected to have a Material Adverse Effect (excluding (i) general
market, economic or geopolitical conditions affecting the U.S. economy in
general and (ii) any such effect resulting from consummation or announcement
of
the transactions contemplated by (x) this Agreement or the Transaction
Documents, (y) the Q-RNA Merger Agreement or (z) the Company’s or its
Subsidiaries’ performance of their respective obligations hereunder or
thereunder, as the case may be;
13
(b) Any
resignation or termination of any officer, key employee or groups of the
Company.
(c) Any
damage, destruction or loss, whether or not covered by insurance, that has
had
or would reasonably be expected to have a Material Adverse Effect;
(d) Any
waiver by the Company of a material right or of a material debt owed to
it;
(e) To
the
Company’s knowledge, any labor organization activity related to the
Company;
(f) Any
debt,
obligation or liability incurred, assumed or guaranteed by the Company, except
those for immaterial amounts and for current liabilities incurred in the
ordinary course of business;
(g) Any
sale,
assignment or transfer of any patents, trademarks, copyrights, trade secrets
or
other intangible assets, other than the nonexclusive license by the Company
of
any such patents, trademarks, copyrights, trade secrets or other intangible
assets to customers, suppliers or contract manufacturers in the ordinary course
of the Company’s business consistent with past practices;
(h) Any
other
event or condition of any character that, either individually or cumulatively,
has or would reasonably be expected to have a Material Adverse Effect;
or
(i) Any
arrangement or commitment by the Company to do any of the acts described in
subsection (a) through (i) above.
3.20 Compliance
with Other Instruments.
The
Company is not in violation or default of any term of its Charter or Bylaws,
or
of any material provision of any mortgage, indenture, contract, agreement,
instrument or contract to which it is party or by which it is bound or of any
judgment, decree, order or writ. The execution, delivery and performance of
and
compliance with this Agreement and the other Transaction Documents to which
it
is a party, and the issuance and sale of the Securities by the Company each
pursuant hereto, will not, with or without the passage of time or giving of
notice, result in any such material violation, or be in conflict with or
constitute a default under any such term or provision, or result in the creation
of any mortgage, pledge, lien, encumbrance or charge upon any of the properties
or assets of the Company or the suspension, revocation, impairment, forfeiture
or nonrenewal of any permit, license, authorization or approval applicable
to
the Company, its business or operations or any of its assets or
properties.
3.21 Insurance.
The
Company has insurance policies with coverage customary for companies similarly
situated, including but not limited to directors and officers liability
insurance. The Company has never been denied insurance coverage. The Company
is
current with respect to all premiums for its insurance policies.
14
3.22 Employees;
ERISA.
(a) The
Company is not bound by or subject to (and none of their assets or properties
are bound by or subject to) any written or oral, express or implied, contract,
commitment, or arrangement with any labor union, and no labor union has
requested or, to the knowledge of the Company, has sought to represent any
of
the employees, representatives, or agents of the Company or its subsidiaries.
There is no strike or other labor dispute involving the Company or any of its
subsidiaries pending, or, to the knowledge of the Company, threatened, which
could reasonably be expected to have a Company Material Adverse Effect, nor
is
the Company aware of any labor organization activity involving its employees.
To
the Company’s knowledge, no employee of the Company is in violation of any
judgment, decree, or order, or any term of any employment contract, patent
disclosure agreement, or other contract or agreement relating to the
relationship of any such employee with the Company, or any other party because
of the nature of the business conducted or presently proposed to be conducted
by
the Company in its SEC Filings.
(b) Except
as
disclosed in the Company Disclosure Package, the Company and its subsidiaries
are not a party to or bound by any currently effective employment contract,
deferred compensation agreement, bonus plan, incentive plan, profit sharing
plan, retirement agreement, or other employee compensation agreement. Neither
the Company nor its subsidiaries have any Employee Benefit Plan as defined
in
the Employee Retirement Income Security Act of 1974, as amended.
3.23 Environmental
and Safety Laws.
(a) During
the period that the Company has leased or owned its properties or owned or
operated any facilities, there have been no disposals, releases or threatened
releases of Hazardous Materials (as defined below) on, from or under such
properties or facilities. The Company has no knowledge of any presence,
disposals, releases or threatened releases of Hazardous Materials on, from
or
under any of such properties or facilities, which may have occurred prior to
the
Company having taken possession of any of such properties or
facilities.
(b) To
the
knowledge of the Company, none of the properties or facilities of The Company
is
in violation of any federal, state or local law, ordinance, regulation or order
relating to industrial hygiene, occupational health and safety, or to the
environmental conditions on, under or about such properties or facilities,
including, but not limited to, soil and ground water condition. During the
time
that the Company has owned or leased its properties and facilities, neither
the
Company, nor, to the Company’s knowledge, any third party, has used, generated,
manufactured or stored on, under or about such properties or facilities or
transported to or from such properties or facilities any Hazardous
Materials.
(c) During
the time that the Company has owned or leased their respective properties and
facilities, there has been no litigation brought or threatened against the
Company by, or any settlement reached by the Company with, any party or parties
alleging the presence, disposal, release or threatened release of any Hazardous
Materials on, from or under any of such properties or facilities.
15
(d) For
the
purposes of this Agreement, the terms “disposal”
“release,”
and
“threatened
release”
shall
have the definitions assigned thereto by the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601 et seq., as
amended (“CERCLA”).
For
the purposes of this Agreement “Hazardous
Materials”
shall
mean any hazardous or toxic substance, material or waste which is or becomes
prior to the Closing regulated under, or defined as a “hazardous substance,”
“pollutant,” “contaminant,” “toxic chemical,” “hazardous materials,” “toxic
substance” or “hazardous chemical” under (1) CERCLA; (2) any similar federal,
state or local law; or (3) regulations promulgated under any of the above laws
or statutes.
3.24 Registration
Rights, Voting Rights, Etc.
Except
as disclosed in the Company Disclosure Package, the Company is presently not
under any obligation, and has not granted any rights, to register any of the
Company’s presently outstanding securities or any of its securities that may
hereafter be issued. Except as disclosed in the Company Disclosure Package,
to
the Company’s knowledge, no stockholder of the Company has entered into any
agreement with respect to the voting of equity securities of the
Company.
The
Company has not adopted a shareholder rights plan or similar agreement relating
to accumulations of beneficial ownership or change of control of the
Company.
3.25 Investment
Company.
The
Company is not an “investment company” within the meaning of such term under the
Investment Company Act of 1940, as amended, or the rules promulgated
thereunder.
3.26 Foreign
Corrupt Practices.
Neither the Company, nor to the knowledge of the Company, any agent or other
person acting on behalf of the Company, has (i) directly or indirectly, used
any
funds for unlawful contributions, gifts, entertainment or other unlawful
expenses related to foreign or domestic political activity, (ii) made any
unlawful payment to foreign or domestic government officials or employees or
to
any foreign or domestic political parties or campaigns from corporate funds,
(iii) failed to disclose fully any contribution made by the Company (or made
by
any person acting on its behalf of which the Company is aware) which is in
violation of law, or (iv) violated in any material respect any provision of
the
Foreign Corrupt Practices Act of 1977, as amended.
4. Representations;
and Warranties of the Investors and Restrictions on
Transfer.
4.1 Representations
and Warranties of the Investors.
Each
Investor, severally and not jointly, hereby represents, warrants and covenants
that:
(a) Authorization.
Such
Investor has full power and authority to enter into this Agreement and the
other
Transaction Documents, and each such agreement constitutes its valid and legally
binding obligation, enforceable in accordance with its terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) to the
extent the indemnification provisions contained herein or in the Investors’
Rights Agreement may be limited by applicable federal or state securities
laws.
16
(b) Purchase
Entirely for Own Account.
This
Agreement is made with such Investor in reliance upon such Investor’s
representation to the Company, which by such Investor’s execution of this
Agreement such Investor hereby confirms, that its Securities will be acquired
for investment for such Investor’s own account, not as a nominee or agent, and
not with a view to the resale or distribution in violation of law of any part
thereof, and that such Investor has no present intention of selling, granting
any participation in or otherwise distributing the same. By executing this
Agreement, such Investor further represents that such Investor does not have
any
contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participations to such person or to any third person, with
respect to any of the Securities.
(c) Disclosure
of Information.
Such
Investor believes it has received all the information it considers necessary
or
appropriate for deciding whether to purchase its Securities. Such Investor
further 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 Securities and the business, properties, prospects and financial condition
of the Company. The foregoing, however, does not limit or modify the
representations and warranties of the Company in Section 3 of this
Agreement or the right of the Investors to rely thereon.
(d) Investment
Experience.
Such
Investor is an investor in securities of companies in the development stage
and
acknowledges that it is able to fend for itself, can bear the economic risk
of
its investment, and has such knowledge and experience in financial or business
matters that it is capable of evaluating the merits and risks of the investment
in the Securities. If other than an individual, such Investor also represents
it
has not been organized for the purpose of acquiring the Securities.
(e) Accredited
Investor.
Such
Investor is an “accredited investor” within the meaning of Securities and
Exchange Commission (“SEC”)
Rule
501 of Regulation D promulgated under the Act, as presently in
effect.
(f) Restricted
Securities.
Such
Investor understands that the Securities it is purchasing are characterized
as
“restricted securities” under the federal securities laws inasmuch as they are
being acquired from the Company in a transaction not involving a public offering
and that under such laws and applicable regulations such Securities may be
resold without registration under the Act only in certain limited circumstances.
In the absence of an effective registration statement covering the Securities
(or the Warrant Shares issuable on exercise of the Warrants) or an available
exemption from registration under the Act, the Securities (and any Common Stock
issued on exercise thereof) must be held indefinitely. In this connection,
such
Investor represents that it is familiar with SEC Rule 144, as presently in
effect, and understands the resale limitations imposed thereby and by the Act,
including without limitation the Rule 144 condition that current information
about the Company be available to the public. Such information is not now
available and the Company has no present plans to make such information
available.
(g) Tax
Advisors.
Such
Investor has reviewed with such Investor’s own tax advisors the federal, state
and local tax consequences of this investment, where applicable, and the
transactions contemplated by this Agreement. Each such Investor is relying
solely on such advisors and not on any statements or representations of the
Company or any of its agents as to such Investor’s tax liability and understands
that each such Investor (and not the Company) shall be responsible for such
Investor’s own tax liability that may arise as a result of this investment or
the transactions contemplated by this Agreement.
17
(h) Residency.
The
residency of the Investor (or, in the case of a partnership or corporation,
such
entity’s principal place of business) is correctly set forth on Schedule
A
hereto.
4.2 Further
Limitations on Disposition.
Without
in any way limiting the representations set forth above, such Investor further
agrees not to make any disposition of all or any portion of the Securities
unless and until (1) the transferee has agreed in writing for the benefit of
the
Company to be bound by this Section 4.2; and (2):
(a) There
is
then in effect a registration statement under the Act covering such proposed
disposition and such disposition is made in accordance with such registration
statement; or
(b) (i) Such
Investor 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 and (ii) if reasonably requested by
the Company, such Investor shall have furnished the Company with an opinion
of
counsel, reasonably satisfactory to the Company, that such disposition will
not
require registration of such shares under the Act. It is agreed that the Company
will not require opinions of counsel for transactions made pursuant to Rule
144.
(c) Notwithstanding
the foregoing, the provisions of subsections (a) and (b) shall not apply to
a
transfer by an Investor (i) that is a partnership to a partner of such
partnership or a retired partner of such partnership who retires after the
date
hereof, or to the estate of any such partner or retired partner or the transfer
by gift, will or intestate succession of any partner to his or her spouse or
to
the siblings, lineal descendants or ancestors of such partner or his or her
spouse; (ii) that is a limited partnership to any member or retired member
of
such limited partnership; (iii) that is a limited liability company to any
member or retired member of such limited liability company; (iv) to an
“affiliate” of such Investor as that term is defined in Rule 405 promulgated by
the Securities and Exchange Commission under the Act; (v) to any person or
entity to the limited extent necessary for an Investor to satisfy applicable
regulatory requirements; or (vi) who is an individual to a family member, family
limited partnership, family limited liability company or trust for the benefit
of such individual Investor, provided, that in each case set forth in (i)
through (vi) above the transferee agrees in writing to be subject to the terms
hereof to the same extent as if he, she or it were an original Investor
hereunder.
18
5. Conditions
of Investor’s Obligations at each Closing.
The
obligations of each Investor to purchase the Securities hereunder at a Closing
are subject to the fulfillment on or before such Closing of each of the
following conditions, the waiver of which shall not be effective against any
Investor who does not consent thereto:
5.1 Representations
and Warranties.
The
representations and warranties of the Company contained in Section 3 shall
be
true in all material respects on and as of such Closing (except for those
representations and warranties already subject to materiality qualifiers, which
shall be true and correct on all respects) with the same effect as though such
representations and warranties had been made on and as of the date of such
Closing.
5.2 Performance.
The
Company shall have performed and complied with all agreements, obligations
and
conditions contained in this Agreement that are required to be performed or
complied with by it on or before such Closing.
5.3 Qualifications.
All
authorizations, approvals or permits, if any, of any governmental authority
or
regulatory body of the United States or of any state that are required in
connection with the lawful issuance and sale of the Securities to be sold at
such Closing pursuant to this Agreement shall be duly obtained and effective
as
of such Closing.
5.4 Opinion
of Counsel
As
a
condition to the Initial Closing, the Initial Investors shall have received
an
opinion of Arent Fox PLLC, counsel to the Company, dated as of the Initial
Closing and addressed to the Initial Investors, in form and substance reasonably
satisfactory to the Investors.
5.5 Q-RNA
Merger
The
transactions contemplated by the Agreement and Plan of Merger dated as of
November 16, 2006 (the “Q-RNA
Merger Agreement”),
by
and among the Company, QA Acquisition Corp., QA Merger LLC, Q-RNA, Inc.
(“Q-RNA”),
and
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, as the Representative named therein, shall have been
consummated, and the Certificates of Merger (as such term is defined in the
Q-RNA Merger Agreement) shall have been filed with the Delaware Secretary of
State.
5.6 Repayment
of Certain Notes
All
outstanding obligations under the Senior Convertible Promissory Note and Loan
Agreements dated as of June 30, 2006, as amended to date, originally issued
by
Q-RNA, shall have been repaid and cancelled.
19
5.7 Deliveries.
The
Company shall have duly executed and delivered to the Investors the following
documents:
(a) this
Agreement;
(b) the
Registration Rights Agreement;
(c) the
certificates representing the Shares;
(d) the
Warrants;
(e) with
respect to the Initial Closing only, a good standing certificate from the State
of Delaware, dated within ten (10) days of the Initial Closing;
(f) with
respect to the Initial Closing only, a certificate of existence from the State
of New York, dated within ten (10) days of the Initial Closing;
(g) with
respect to the Initial Closing only, a certificate signed by the President
of
the Company, dated the date of such Closing, stating that the conditions set
forth in 5.1 through 5.3 are satisfied;
(h) with
respect to the Initial Closing only, a certificate of the Company’s Secretary,
dated the date of such Closing, to the effect that (i) attached thereto is
a
true and complete copy of the Certificate and Bylaws in effect on the date
thereof, (ii) the Certificate and Bylaws are sufficient in form and substance
to
permit the transactions contemplated by this Agreement and the Transaction
Documents, and (iii) attached thereto are certified copies of the resolutions
duly adopted by the Company’s Board of Directors authorizing the execution,
delivery and performance of this Agreement and the other Transaction Documents,
and the issuance and sale of the Securities;
(i) copies
of
all third party and governmental consents, waivers, approvals and filings
required in connection with the consummation of the transactions hereunder,
except with respect to securities compliance filings required or permitted
to be
made by the Company after such Closing, which the Company shall make on a timely
basis; and
(j) all
corporate and legal proceedings taken by the Company in connection with the
transactions contemplated by this Agreement and all original or certified copies
of such other documents relating to this transaction as the Investors shall
reasonably request.
6. Covenants
of the Company.
6.1 Stop-Orders.
The
Company will advise the Investors, promptly after it receives notice of issuance
by the Securities and Exchange Commission (the “SEC”),
any
state securities commission or any other regulatory authority of any stop order
or of any order preventing or suspending any offering of any securities of
the
Company, or of the suspension of the qualification of the Common Stock of the
Company for offering or sale in any jurisdiction, or the initiation of any
proceeding for any such purpose.
20
6.2 Market
Regulations.
The
Company shall notify the SEC and, if required under state securities laws,
all
applicable state authorities, in accordance with their requirements, of the
transactions contemplated by this Agreement, and shall take all other necessary
action and proceedings as may be required and permitted by applicable law,
rule
and regulation, for the legal and valid issuance of the Securities to the
Investors and promptly provide following effectiveness thereof copies thereof
to
the Investors.
6.3 Reporting
Requirements.
The
Company will file with the SEC all reports required to be filed pursuant to
the
Exchange Act on a timely basis, taking into account any and all extensions
granted or permitted by the SEC, and refrain from terminating its status as
an
issuer required by the Exchange Act to file reports thereunder even if the
Exchange Act or the rules or regulations thereunder would permit such
termination (other than as a result of the acquisition of the Company).
Without
limiting the generality of the foregoing, on or before November 22, 2006, the
Company shall file a Current Report on Form 8-K, disclosing the material terms
of the transactions contemplated hereby and by the Q-RNA Merger Agreement,
and
shall attach thereto as exhibits all documents required to be filed
therewith.
6.4 Use
of Proceeds.
The
Company agrees that it will use the proceeds of the sale of the Securities
for
general corporate purposes only,
and not
to redeem any shares of its Common Stock or other Securities.
6.5 Access
to Facilities.
The
Company will permit any representatives designated by the Investors (or any
successor of the Investor), upon reasonable prior written notice and during
normal business hours, at such person’s expense and accompanied by a
representative of the Company, to (a) visit and inspect any of the
properties of the Company, (b) examine the corporate and financial records
of the Company (unless such examination is not permitted by federal, state
or
local law or by contract) and make copies thereof or extracts therefrom and
(c) discuss the affairs, finances and accounts of the Company with the
officers of the Company. Notwithstanding the foregoing, the Company will not
provide any material, non-public information to any Investor unless such
Investor signs a confidentiality agreement and otherwise complies with
Regulation FD, under the federal securities laws.
6.6 Reservation
of Shares.
The
Company shall take all such corporate action as may be required to assure that
the Company shall at the appropriate times have authorized and reserved, free
from preemptive or other similar rights, a sufficient number of shares of its
Common Stock to provide for the exercise of the Warrants. The Company will
obtain any authorization, consent, approval or other action by or make any
filing with any governmental agency that may be required under applicable
federal or state securities laws in connection with the issuance of the Warrant
Shares upon exercise of the Warrants.
6.7 Reissuance
of Securities.
The
Company agrees to reissue certificates representing the Securities and the
Warrant Shares without the legends set forth in Section 4.3 above at such
time as (a) the holder thereof is permitted to dispose of such Securities
or Warrant Shares, as the case may be, pursuant to Rule 144(k) under the
Securities Act, or (b) upon resale subject to an effective registration
statement after such Securities or Warrant Shares, as the case may be, are
registered under the Securities Act. The Company agrees to cooperate with the
Investors in connection with all resales pursuant to Rule 144(d) and Rule 144(k)
and provide legal opinions necessary to allow such resales provided the Company
and its counsel receive reasonably requested representations from the selling
Investor and broker, if any.
21
As
long
as any Investor owns Securities, if the Company is not required to file reports
pursuant to the Exchange Act, it will prepare and furnish to the Investors
and
make publicly available in accordance with Rule 144(c) such information as
is
required for the Investors to sell the Securities under Rule 144.
6.8 Integration.
The
Company shall not 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 Investors or that would be integrated with the offer
or
sale of the Securities for purposes of the rules and regulations of any exchange
or trading market on which any of the securities of the Company may be listed
or
designated, such that it would require shareholder approval prior to the closing
of such other transaction unless stockholder approval is obtained before the
closing of such subsequent transaction.
6.9 Shareholder
Rights Plan.
No
claim will be made or enforced by the Company or, with the consent of the
Company, any other Person, that any Investor is an “Acquiring Person” under any
control share acquisition, poison pill (including any distribution under a
rights agreement) or similar anti-takeover plan or arrangement in effect or
hereafter adopted by the Company, or that any Investor could be deemed to
trigger the provisions of any such plan or arrangement, by virtue of receiving
Securities under the Transaction Documents or under any other agreement between
the Company and the Investors.
6.10 Subsequent
Equity Sales.
During
the period beginning on the Execution Date until the Company shall have
consummated in full the Additional Financing, if the Company shall issue and
sell to any party, or agree to issue and sell to any party, any shares of Common
Stock, or securities that are, directly or indirectly, convertible into or
exercisable or exchangeable for Common Stock (other than shares of Common Stock
issued or issuable to employees, officers, directors and consultants of the
Company directly or pursuant to stock options as compensatory arrangements),
on
terms that are more favorable than those offered to the Investors under this
Agreement or any of the other Transaction Documents (including without
limitation voting and board designation rights; registration rights; rights
of
first offer on subsequent issuances; preferences on liquidation, redemption
or
dividends; covenant protections; and protections against dilutive issuances)
(collectively, “Superior
Terms”),
or
alter, amend or modify, by reclassification or otherwise, any currently
outstanding securities or contractual arrangements relating thereto in any
manner that shall result in such outstanding securities having Superior Terms,
then forthwith such Superior Terms shall be deemed applicable to the
transactions contemplated hereby, and the Company will cooperate and take all
such action as may be necessary to effectuate the foregoing provisions of this
Section 6.10.
6.11 Form
D; Blue Sky Filings.
The
Company agrees to timely file a Form D with respect to the Securities as
required under Regulation D and to provide a copy thereof, promptly upon request
of any Investor. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to
qualify the Securities for, sale to the Investors at the Closing under
applicable securities or “Blue Sky” laws of the states of the United States, and
shall provide evidence of such actions promptly upon request of any
Investor.
22
7. Indemnification.
Subject
to the provisions of this Section 7, in addition to all of the Company’s other
obligations under the Transaction Documents, the Company will indemnify, protect
and hold the Investors and their directors, officers, shareholders, members,
partners, employees and agents (and any other Persons with a functionally
equivalent role of a Person holding such titles notwithstanding a lack of such
title or any other title), each Person who controls such Investor (within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act),
and the directors, officers, shareholders, agents, members, partners or
employees (and any other Persons with a functionally equivalent role of a Person
holding such titles notwithstanding a lack of such title or any other title)
of
such controlling persons (each, an “Investor
Party”)
harmless from any and all losses, liabilities, obligations, claims,
contingencies, damages, actions, causes of action, suits, penalties, fees,
costs
and expenses, (irrespective of whether any such Investor Party is a party to
the
action for which indemnification hereunder is sought), including all judgments,
amounts paid in settlements, court costs and reasonable attorneys’ fees and
costs of investigation (collectively, the “Indemnified
Liabilities”)
that
any such Investor Party may suffer or incur as a result of, arising out or,
or
relating to (a) any misrepresentation or breach of any representation or
warranty made by the Company in the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby (unless,
and
only to the extent that, such action is based upon a breach of representations,
warranties or covenants under the Q-RNA Merger Agreement), (b) any breach of
any
covenant, agreement or obligation of the Company contained in the Transaction
Documents or any other certificate, instrument or document contemplated hereby
or thereby or (c) any cause of action, suit or claim brought or made against
such Investor Party by a third party (including for these purposes a derivative
action brought on behalf of the Company) and arising out of or resulting from
(i) the execution, delivery, performance or enforcement of the Transaction
Documents or any other certificate, instrument or document contemplated hereby
or thereby, (ii) any transaction financed or to be financed in whole or in
part,
directly or indirectly, with the proceeds of the issuance of the Securities,
or
(iii) the status of such Investor or holder of the Securities as an investor
in
the Company pursuant to the transactions contemplated by the Transaction
Documents (unless, and only to the extent that, such action is based solely
upon
a breach of such Investor’s representations, warranties or covenants under the
Transaction Documents or any conduct by such Investor which constitutes fraud,
gross negligence or willful misconduct). If any action shall be brought
against any Investor Party in respect of which indemnity may be sought pursuant
to this Agreement, such Investor Party shall promptly notify the Company in
writing, and the Company shall have the right to assume the defense thereof
with
counsel of its own choosing reasonably acceptable to such Investor. Any
Investor Party shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and expenses of
such
counsel shall be at the expense of such Investor Party except to the extent
that
(i) the Company has failed after a reasonable period of time to assume such
defense and to employ counsel reasonably acceptable to such Investor, or (ii)
in
such action there is, in the reasonable opinion of such separate counsel, a
material conflict on any material issue between the position of the Company
and
the position of such Investor Party (in which case, if such Indemnified Party
notifies the Indemnifying Party in writing that it elects to employ separate
counsel at the expense of the Indemnifying Party, the Indemnifying Party shall
not have the right to assume the defense thereof and the reasonable fees and
expenses of one separate counsel shall be at the expense of the Indemnifying
Party). The Company will not be liable to any Investor Party under this
Agreement for any settlement by an Investor Party effected without the Company’s
prior written consent, which shall not be unreasonably withheld or delayed.
The
Company shall not, without the prior written consent of the applicable Investor
Party, consent to entry of any judgment or enter into any settlement or other
compromise which does not include as an unconditional term thereof the giving
by
the claimant or plaintiff to the applicable Investor Party of a release from
all
liability in respect to such claim or litigation. The failure to deliver
written notice to the Company within a reasonable time of the commencement
of
any such action shall not relieve the Company of any liability to the Investor
Party under this Section 7, except to the extent that the Company is prejudiced
in its ability to defend such action.
23
8. Termination.
8.1 This
Agreement may be terminated at any time prior to the Initial Closing by the
mutual written consent of each of the parties hereto.
8.2 Unless
otherwise agreed by the parties hereto, this Agreement will be terminated if
all
conditions to the Initial Closing have not been satisfied or waived on or before
December 15, 2006 (the “Termination Date”); provided, however, that the right to
terminate this Agreement pursuant to this Section 8.2 shall not be available
to
any party whose failure to perform in any material respect any of its
obligations or covenants under this Agreement results in the failure of any
condition set forth in Section 5 or if the failure of such condition results
from facts or circumstances that constitute a material breach of a
representation or warranty or covenant made under this Agreement by such
party.
8.3 Either
the Investors or Company, by giving written notice to the other, may terminate
this Agreement if a court of competent jurisdiction or other governmental
authority shall have issued a nonappealable final order, decree or ruling or
taken any other action, in each case having the effect of permanently
restraining, enjoining or otherwise prohibiting the Q-RNA Merger or the
transactions contemplated by this Agreement.
8.4 Upon
any
such termination, the Company shall promptly instruct the Escrow Agent to
release to the Investors any amounts held pursuant to the escrow arrangement
described in Section 1.4 above.
9. Miscellaneous.
9.1 Survival
of Representations, Warranties and Covenants.
The
representations, warranties and covenants of the Company and the Investors
contained in or made pursuant to this Agreement will survive the execution
and
delivery of this Agreement and the other Transaction Documents and the Closing
and will in no way be affected by any investigation of the subject matter
thereof made by or on behalf of the Investors or the Company.
24
9.2 Successors
and Assigns.
Except
as
otherwise provided herein, the terms and conditions of this Agreement may not
be
assigned by any Investor without the prior written consent of the Company,
other
than to one or more affiliates or beneficial owners or another Investor. The
Company may not assign its rights or obligations under this Agreement. Nothing
in this Agreement, express or implied, is intended to confer upon any party
other than the parties hereto or their respective successors and assigns any
rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
9.3 Counterparts.
This
Agreement may be executed in counterparts, each of which will be deemed an
original, but all of which together will constitute one and the same
instrument.
9.4 Captions
and Headings.
The
captions and headings used in this Agreement are used for convenience only
and
are not to be considered in construing or interpreting this
Agreement.
9.5 Notices.
Unless
otherwise provided herein, all notices, requests, waivers and other
communications made pursuant to this Agreement will be in writing and will
be
deemed to have been duly given:
(a) when hand delivered to the other party; (b) when sent by
confirmed
facsimile
if sent
between 8:00 a.m. and 5:00 p.m. recipient’s local time on a business day, or on
the next business day if sent by facsimile
if sent
other than between 8:00 a.m. and 5:00 p.m. recipient’s local time on a business
day; (c) three business days after deposit in the U.S. mail, postage
prepaid;
or
(d) the next business day after deposit with a national overnight delivery
service, postage prepaid, with
next
business day delivery guaranteed. All communications shall be sent, if to the
Company, then to the address (or
facsimile number, as the case may be) as
set
forth on the signature page hereof, with a copy to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.,
Arent Fox PLLC, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, facsimile
number: (▇▇▇) ▇▇▇-▇▇▇▇, or, if to an Investor, at such Investor’s address
(or
facsimile number, as the case may be) set
forth
on Schedule A hereto,
with a
copy to ▇▇▇ ▇. ▇▇▇▇, Esq., Manatt, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, LLP, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇;
or, in
any such case, at such other address or addresses as shall have been furnished
in writing by such party to the others.
9.6 Finder’s
Fee.
Each
Investor agrees to indemnify and to hold harmless the Company from any liability
for any commission or compensation in the nature of a finders’ fee (and the
costs and expenses of defending against such liability or asserted liability)
for which such Investor or any of its officers, partners, employees or
representatives is responsible. The Company agrees to indemnify and hold
harmless each Investor from any liability for any commission or compensation
in
the nature of a finder’s fee (and the costs and expenses of defending against
such liability or asserted liability) for which the Company or any of its
officers, employees or representatives is responsible.
25
9.7 Expenses.
The
Company shall pay the reasonable fees of Manatt, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, LLP,
counsel to the Investors, in connection with the negotiation and documentation
of the transactions contemplated hereby, not to exceed $65,000, and will pay
all
costs and expenses incurred by the Investors with respect to any modification,
amendment or waiver of the terms of with this Agreement or the other Transaction
Documents. If any action at law or in equity is necessary to enforce or
interpret the terms of this Agreement, the other Transaction Documents or the
Charter, the prevailing party will be entitled to reasonable attorney’s fees,
costs and necessary disbursements in addition to any other relief to which
such
party may be entitled.
9.8 Amendments
and Waivers.
(a) Any
term
of this Agreement or the Warrants may be amended and the observance of any
term
of this Agreement may be waived (either generally or in a particular instance
and either retroactively or prospectively), only with the written consent of
the
Company and Investors holding a majority of the Shares purchased hereunder
(which majority must include a majority in interest of the Initial Investors),
provided that any party purchasing Securities at a Subsequent Closing may become
a party to this Agreement in accordance with Section 1.3(b) without any
amendment pursuant to this paragraph or any consent or approval of any other
Investor. Notwithstanding the foregoing sentence, the consent of each affected
Investor shall be necessary to do the following:
(i) amend
or
modify this Section 9.8; or
(ii) make
any
change in the Transaction Documents that modifies or amends any provision of
any
Warrant relating to the number or type of Warrant Shares for which such Warrant
is exercisable, or the exercise price of such Warrant.
(b) Any
amendment or waiver effected in accordance with this paragraph will be binding
upon each holder of any Securities purchased under this Agreement at the time
outstanding (including securities into which such securities are convertible),
each future holder of all such Securities, and the Company.
9.9 Enforceability;
Severability.
If
one or
more provisions of this Agreement are held to be prohibited, invalid or
unenforceable under applicable law, such provision will be effective to the
fullest extent possible excluding the terms affected by such prohibition,
invalidity or unenforceability, without invalidating the remainder of such
provision or the remaining provisions of this Agreement. If the prohibition,
invalidity or unenforceability referred to in the prior sentence requires such
provision to be excluded from this Agreement in its entirety, the balance of
the
Agreement will be interpreted as if such provision were so excluded and will
be
enforceable in accordance with its terms.
26
9.10 Governing
Law; Venue.
This
Agreement is to be construed in accordance with and governed by the internal
laws of the State of New York without giving effect to any choice of law rule
that would cause the application of the laws of any jurisdiction other than
the
internal laws of the State of New York to the rights and duties of the parties.
Each of the Company and the Investors hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District
of
New York and of any New York State court sitting in New York City for purposes
of all legal proceedings arising out of or relating to this Agreement and the
transactions contemplated hereby.
9.11 Waiver
of Jury Trial.
EACH
PARTY HERETO HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE OTHER TRANSACTION
DOCUMENTS, THE SECURITIES OR THE SUBJECT MATTER HEREOF OR THEREOF. THE SCOPE
OF
THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT
MAY
BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THIS SECTION HAS BEEN
FULLY DISCUSSED BY EACH OF THE PARTIES HERETO AND THESE PROVISIONS WILL NOT
BE
SUBJECT TO ANY EXCEPTIONS. EACH PARTY HERETO HEREBY FURTHER WARRANTS AND
REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL,
AND
THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER WILL APPLY TO
ANY
SUBSEQUENT AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS TO (OR ASSIGNMENTS OF)
THIS
AGREEMENT. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL (WITHOUT A JURY) BY THE COURT.
9.12 Aggregation
of Stock.
All
Securities held or acquired by entities advised by the same investment adviser
and affiliated entities or persons will be aggregated together for the purpose
of determining the availability of any rights under this Agreement.
9.13 Entire
Agreement.
This
Agreement and the documents referred to herein constitute the entire agreement
among the parties with respect to the subject matter hereof and no party will
be
liable or bound to any other party in any manner by any warranties,
representations or covenants except as specifically set forth herein or
therein.
27
9.14 Delays
or Omissions.
No
delay
or omission to exercise any right power or remedy accruing to any party under
this Agreement, or upon any breach or default of any other party under this
Agreement, will impair any such right, power or remedy of such non-breaching
or
non-defaulting party nor will it be construed to be a waiver of any such
breach
or default, or an acquiescence therein, or of or in any similar breach or
default thereafter occurring; nor will any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind
or
character on the part of any party of any provisions or conditions of this
Agreement, must be in writing and will be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any party, will be cumulative
and
not alternative.
9.15 Exculpation
Among Investors.
Each
Investor acknowledges that it is not relying upon any person, firm or
corporation, other than the Company and its officers and directors, in making
its investment or decision to invest in the Company. Each Investor agrees that
no Investor nor the respective controlling persons, officers, directors,
partners, agents, members, managers or employees of any Investor shall be liable
to any other Investor for any action heretofore or hereafter taken or omitted
to
be taken by any of them in connection with the purchase of the
Securities.
* * *
28
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
| COMPANY: | ||
| NEURO-HITECH, INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ | |
|
▇▇▇▇▇ ▇▇▇▇▇▇▇, Chief Financial Officer |
||
| Address: | ||
|
Neuro-Hitech,
Inc.
▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
||
|
Facsimile:
__________________________
|
||
| INVESTORS: | |||
|
▇▇▇▇▇▇▇▇
MEDTECH
PARTNERS,
LP
|
|||
| By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
|
Name:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, MD
|
|||
|
Title:
VP
|
|||
|
Address:
|
Facsimile:
|
▇▇▇▇▇▇
VENTURES
|
|||
| By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
|
Name: ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
|
|||
|
Title:
Managing
Director
|
|||
|
Address:
|
Facsimile:
|
▇▇▇▇▇▇▇▇
NEW
YORK
PARTNERS,
LP
|
||
|
By: ▇▇▇▇▇▇▇▇
NY PARTNERS,
LLC, ITS GENERAL
PARTNER |
||
| By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ |
|
|
|
Name: ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, MD
|
||
|
Title:
VP
|
||
|
Address:
|
||
Facsimile:
| ▇▇▇▇▇▇ Capital Investments, LLC | ||
|
|
||
| By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ |
|
|
|
Name:
▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇
|
||
|
Title:
CIO
|
||
|
Address:
|
||
|
CGM
as C/F ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (▇▇▇)
|
||
| By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ |
|
|
|
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
|
||
| Address: | ||
|
CGM
as C/F ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (▇▇▇)
|
||
| By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ |
|
|
|
Name:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
|
||
| Address: | ||
SIGNATURE
PAGE TO THE SECURITIES PURCHASE AGREEMENT
SCHEDULE
A
SCHEDULE
OF INVESTORS
SCHEDULE
A
SCHEDULE
B
-i-
EXHIBIT
A
FORM
OF
WARRANT
-ii-
EXHIBIT
B
FORM
OF
REGISTRATION RIGHTS AGREEMENT
-iii-