OMNIMMUNE HOLDINGS, INC. SUBSCRIPTION AGREEMENT
Exhibit 10.1
▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, CEO
Gentlemen:
1. Subscription.
1.1 Offering. The
undersigned understands that Omnimmune Holdings, Inc., a corporation organized
under the laws of the State of Delaware (the “Company”), is offering to sell to
accredited investors (the “Offering”) up to $500,000 principal amount of
unsecured convertible promissory notes in the form annexed hereto as Exhibit A
(the “Notes”), which Notes are convertible into shares of common stock, par
value $.0001 per share (the “Common Stock”), of the Company at a conversion
price equal to $.01 per share of Common Stock, subject to adjustment as set
forth in the Notes. The purchase price of the Notes shall be equal to their
principal amount. The undersigned understands that the Offering is
part of a recapitalization of the Company as described in the term sheet annexed
hereto as Exhibit B (the “Term Sheet”).
1.2 Manner of
Subscription. The undersigned (the “Subscriber”) hereby
subscribes for and agrees to purchase Notes for an aggregate purchase price of
$________ on the terms and conditions described herein. The
undersigned hereby delivers (which delivery may be by facsimile transmission) to
the Company an executed copy of this Subscription Agreement and an executed copy
of the Purchaser Questionnaire. Upon execution and delivery of this
Subscription Agreement by the Company, the undersigned hereby agrees to wire
immediately to the Company, in accordance with the wire instructions annexed
hereto as Exhibit C, the amount indicated above. Upon the Closing,
the Company agrees to deliver to the undersigned a Note or Notes in the
aggregate principal amount of the subscription.
1.3 Closing. The
undersigned acknowledges and agrees that the closing of this Offering is
conditioned upon the receipt and acceptance by the Company of subscriptions for
a minimum of $200,000 principal amount of Notes. The Company may hold a closing
(the “Closing”) after it has received one or more subscriptions aggregating at
least such minimum principal amount of Notes to accept such subscriptions.
Thereafter the Company may from time to time at any time through February 28,
2010, or later if the Company determines to extend the Offering in its sole
discretion, hold additional Closings to accept additional
subscriptions for Notes having a maximum aggregate subscription price of
$500,000. Upon acceptance of subscriptions and delivery of the applicable Notes
to the Subscriber, use of the funds by the Company shall be unrestricted unless
otherwise provided herein.
The
Company shall promptly notify the Subscriber of the acceptance of his or her
subscription and/or termination of the Offering. If this subscription
is rejected, this Subscription Agreement shall have no force or
effect.
1.4 Subscribers’ Legal
Fees. The Company agrees to pay legal fees in the amount of
$7,500 to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, as counsel to the Subscribers in the Offering,
payable at the first Closing, and additional legal fees of $7,500 to ▇▇.
▇▇▇▇▇▇▇▇ if the Company receives subscriptions for $500,000.
2. Representations, Warranties
and Covenants of the Subscriber.
2.1 Purchaser
Questionnaire. The Subscriber represents and warrants to the
Company that the statements set forth on the Subscriber’s Purchaser
Questionnaire are true, correct and complete.
2.2 Representations and
Warranties. The Subscriber, by signing this Subscription Agreement,
represents and warrants to the Company that:
(a) All Notes
purchased by him are being acquired by him for his own account (or for accounts
for which he has sole investment discretion) for investment, without any
intention of selling, further distributing, or otherwise disposing of the Notes
or the shares of Common Stock into which they are convertible (such
shares of Common Stock being referred to herein as the “Underlying
Securities”).
(b) Subscriber
has been advised that none of the Notes or any of the Underlying Securities are
registered under the federal Securities Act of 1933, as amended (the “33 Act”),
or any state securities laws. The Subscriber understands that the
offering and sale of the Notes is intended to be exempt from registration under
the 33 Act by virtue of Section 4(2) thereof or the provisions of Regulation D
promulgated thereunder, based, in part, upon the representations, warranties and
agreements of the Subscriber contained in this Subscription Agreement and the
Purchaser Questionnaire.
(c) The
Subscriber must bear the substantial economic risks of the investment in the
Notes indefinitely because none of the Notes or Underlying Securities may be
sold, hypothecated or otherwise disposed of unless subsequently registered under
the 33 Act and applicable state securities laws or an exemption from such
registration is available. The Subscriber understands that legends
shall be placed on the Underlying Securities to the effect that they have not
been registered under the 33 Act or applicable state securities laws and
appropriate notations thereof will be made in the Company’s books.
(d) The
Subscriber understands that neither the Securities and Exchange Commission nor
any state securities commission has approved the Notes or passed upon or
endorsed the merits of this Offering or confirmed the accuracy or determined the
adequacy of any information provided by the Company to the
Subscriber.
(e) In
evaluating the suitability of an investment in the Company, the Subscriber has
not relied upon any representation or other information (oral or written) other
than as stated herein, in the Company’s public filings with the Securities and
Exchange Commission filed prior to the date of this Subscription (the “Public
Filings”), or as contained in documents or answers to questions furnished to the
Subscriber by the Company.
(f) The
Subscriber is aware that an investment in the Notes involves a high degree of
risk and has asked such questions and reviewed such documents as the Subscriber
deems necessary for evaluating such risk. Subscriber acknowledges
having reviewed the Public Filings and is aware of the disclosures contained
therein, including those considered material.
(g) The
Subscriber will, prior to any attempted sale, transfer, assignment, gift or
other disposition (each, a “Transfer”) of Notes or of Underlying Securities,
give written notice to the Company expressing its desire to effect such Transfer
and describing in detail the proposed Transfer, provided, however, that no such
notice shall be required for a Transfer of Notes or Underlying Securities if
there is a registration statement under the 33 Act in effect with respect to
such securities or if the Transfer is being effected pursuant to Rule 144 under
the 33 Act. Upon receiving such notice, the Company shall present
copies thereof to counsel for the Company to evaluate said Transfer pursuant to
the 33 Act and the Securities Exchange Act of 1934, as then in force (the “34
Act”), or any similar statute, and applicable state securities
law. Unless such counsel advises the Company that such Transfer could
reasonably be deemed to violate the 33 Act or the 34 Act, the Company shall
promptly cause such Transfer to be processed and shall promptly obtain any legal
opinion reasonably required in connection with such Transfer.
(h) The
Subscriber does not presently have any reason to anticipate any change in his
economic circumstances or any other particular occasion or event which would
cause it to sell any of the Notes or Underlying Securities.
(i) The
Subscriber is fully aware that in agreeing to sell and issue such Notes to it
and in entering this Subscription Agreement, the Company is relying upon the
truth and accuracy of the representations and warranties of the Subscriber made
herein.
(j) The
Subscriber is experienced in investing in non-listed and non-registered
securities, specifically early stage companies engaged in biotech or related
businesses. The Subscriber has been granted the opportunity to ask
questions of, and receive answers from, the Company concerning the terms and
conditions of this Offering and the Company and to obtain such additional
information as it deems necessary to verify the accuracy of the information
contained in the offering materials or which otherwise may be desired to make an
informed investment decision.
(k) The
Subscriber acknowledges having read and understood the Term Sheet, including the
dilutive effect its implementation will have on the Company’s capital structure
as a result of the lowering of the conversion price on certain previously issued
notes and the prospective anti-dilution protection being offered to the
Company’s management and certain angel investors, all as described in the Term
Sheet.
3. Representations, Warranties
and Covenants of the Company.
3.1 Organization and
Existence. The Company is a corporation duly organized, validly
existing and in good standing under the law of the State of
Delaware.
3.2 Corporate
Power. The Company (i) has all requisite corporate power and
authority to own, lease and operate its properties and carry on its business as
now being conducted and (ii) is duly qualified and in good standing to do
business in each jurisdiction in which the nature of its business or the nature
or location of its assets require such qualification and where the failure to be
so qualified and in good standing would have a Material Adverse Effect on the
Company. For purposes of this Agreement, “Material Adverse Effect” means, with
respect to the Company, a materially adverse effect on the business, results of
operations, financial condition, properties, assets or prospects of the
Company.
3.3 Due Authorization;
Enforceability. The Company has all necessary corporate power
and authority to enter into this Subscription Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this
Subscription Agreement by the Company and the performance by the Company of its
obligations hereunder have been duly authorized and approved by all requisite
corporate action and no other corporate proceedings on the part of the Company
are necessary to authorize this Subscription Agreement or for the Company to
consummate the transactions contemplated hereby. This Subscription Agreement has
been duly executed and delivered by duly authorized officers of the Company and
constitutes a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms.
3.4 Consents. No
consent, approval, order or authorization of, or registration, declaration or
filing with, any court, administrative agency or commission or other
governmental authority or instrumentality (each of the foregoing being a
“Governmental Entity”), is required with respect to the Company in connection
with the execution and delivery of this Subscription Agreement by the Company or
the consummation by the Company of the transactions contemplated
hereby.
3.5 No
Breach. Neither the execution and delivery of this
Subscription Agreement by the Company, nor the consummation by the Company of
the transactions contemplated hereby, will (i) conflict with or result in a
breach of any of the terms or provisions of the Company’s Certificate of
Incorporation or By-Laws, (ii) violate any statute or administrative regulation,
or any order, writ, injunction, judgment or decree of any court or governmental
authority or any arbitration award to which the Company is a party or by which
the Company or any of its properties or assets are bound, or (iii) violate,
conflict with, breach, constitute a default (or an event which, with notice or
lapse of time or both would constitute a default) under, or result in the
termination of, or accelerate the performance required by, or result in the
creation of any lien or other encumbrance upon any of the properties or assets
of the Company under, any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to which the Company
is a party or to which it or any of its properties or assets are subject except
in the case of clauses (ii) or (iii) for violations, conflicts, breaches,
defaults, terminations, accelerations or creations of liens or other
encumbrances that do not and will not, individually or in the aggregate, (x)
have a Material Adverse Effect on the Company or (y) materially impair the
ability of the Company to perform its obligations under this Subscription
Agreement and the Notes. Notwithstanding the foregoing, the
Subscriber acknowledges and understands that, unless and until there is an
increase in the authorized share capital of the Company, the number of shares of
Common Stock into which the all outstanding options, warrants and convertible
securities would be convertible upon consummation of the transactions
contemplated by the Offering and the Term Sheet would substantially exceed the
total number of currently authorized shares of the
Company. Accordingly, pending an increase in authorized share
capital, there may not be sufficient authorized shares available for issuance
upon receipt by the Company of a request for conversion of the
Notes. Subscriber agrees and acknowledges that the right to
convert shall be subject to the availability of a sufficient number of
authorized and unissued shares of Commons Stock of the Company to
accommodate the conversion as measured at the time a request for conversion is
made.
3.6 Capitalization of the
Company. Except as set forth above, the Company has one class
of stock authorized, consisting of 50 million shares of Common
Stock. Without giving effect to the Offering or the transactions
contemplated by the Term Sheet, the Company has outstanding 8,914,921 shares of
Common Stock. Without giving effect to the transactions contemplated
by the Term Sheet, there are outstanding options, warrants and convertible
securities entitling the holders to purchase or acquire upon conversion
11,737,491 shares of Common Stock of the Company. Except as set forth
above and in the Term Sheet, the Company has no outstanding Common Stock or any
options, warrants or rights of any kind to purchase any shares of the capital
stock of the Company and no outstanding securities convertible into or
exercisable for shares of capital stock of the Company and has no outstanding
commitment to issue any such options, warrants, rights, or convertible or
exercisable securities.
3.7 Liabilities. The
Company does not have any liabilities or obligations of any nature (whether
accrued, absolute, contingent or otherwise) (“Liabilities”) other than (i)
Liabilities which were incurred in the ordinary course of business and (ii)
Liabilities disclosed in the Company’s Public Filings.
3.8 Legal
Proceedings. There is no litigation or proceeding, in law or in
equity, and there are no proceedings or governmental investigations before any
commission, authority, agency or other administrative authority, pending or, to
the Company’s knowledge, threatened against the Company with respect to or
affecting the Company’s operations, business or financial
condition. Notwithstanding the foregoing, the Subscriber
acknowledges the existence of the threatened litigation with Ohio State
University, and the potential consequences thereof, as disclosed in the Public
Filings.
3.9 No
Judgments. The Company is not a party to, or bound by, any
judgment, writ, injunction, decree, order or arbitration award (or agreement
entered into in any administrative, judicial or arbitration proceeding with any
Governmental Entity) with respect to or affecting the properties, assets,
personnel or business activities of the Company.
3.10 Intellectual
Property. The Company and its Subsidiaries own, license
or otherwise have the right to use all intellectual property, including without
limitation, all patents, copyrights, trademarks, trade names, trade secrets and
rights in respect of the foregoing, adequate for the conduct of the Company’s
business substantially as now conducted and proposed to be conducted without any
known conflict with any rights of others. To the knowledge of the
Company, the Company has not interfered with, infringed upon, misappropriated or
otherwise come into conflict with any intellectual property rights of third
parties, nor has the Company received any charge, complaint, claim, demand or
notice alleging any such interference, infringement, misappropriation or
violation (including any claim that the Company must license or refrain from
using any intellectual property rights of any third party). To the
knowledge of the Company, no third party has interfered with, infringed upon,
misappropriated or otherwise come into conflict with any intellectual property
rights of the Company.
3.12
Information
Concerning the Company. The information filed by the Company
pursuant to Section 13 the Securities Exchange Act of 1934, as amended, did not,
as of the date of such filings, contain any untrue statement of material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances in which
made.
3.13 Registration
Rights. The Company hereby grants piggyback registration rights to
the Subscriber on customary terms and subject to customary underwriter cut-back
provisions with respect to any shares of Common Stock issuable upon
conversion of the Notes purchased by the Subscriber.
4. Disclosure.
This
Offering is limited to accredited investors in reliance upon exemptions
contained in the 33 Act and Regulation D promulgated thereunder and applicable
state securities laws. Accordingly, the Company is offering the Notes
utilizing this Subscription Agreement rather than a formal private offering
memorandum. The undersigned understands that this Subscription
Agreement, together with any additional information or documents provided by the
Company to the Subscriber, contains less information than would be included in a
formal private offering memorandum. In making an investment decision
Subscribers must rely on their own examination of the Company, the information
in the Public Filings, and the terms of the Offering, including the
risks involved.
5. Special
Acknowledgements.
(i) NEW YORK
RESIDENTS
THE
OFFERING LITERATURE USED IN CONNECTION WITH THE OFFERING HAS NOT BEEN FILED WITH
OR REVIEWED BY THE ATTORNEY GENERAL OF THE STATE OF NEW YORK PRIOR TO ITS
ISSUANCE AND USE. THE ATTORNEY GENERAL OF NEW YORK HAS NOT PASSED ON OR ENDORSED
THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
(ii) CALIFORNIA
RESIDENTS:
THE SALE
OF THE SECURITIES WHICH ARE THE SUBJECT OF THIS OFFERING HAS NOT BEEN QUALIFIED
WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE
ISSUANCE OF SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE
CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE
OF SECURITIES IS EXEMPTED FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF
THE CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS
OFFERING ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATIONS BEING OBTAINED,
UNLESS THE SALE IS SO EXEMPT.
(iii) CONNECTICUT
RESIDENTS:
THE
SECURITIES OFFERED HEREBY ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION AND HAVE
NOT BEEN REGISTERED UNDER SECTION 36-485 OF THE CONNECTICUT UNIFORM SECURITIES
ACT. THE SECURITIES OFFERED HEREBY CANNOT, THEREFORE, BE RESOLD OR
TRANSFERRED UNLESS THEY ARE REGISTERED UNDER THE ACT OR UNLESS AN EXEMPTION FROM
REGISTRATION IS AVAILABLE.
6.
Indemnification
and Hold Harmless.
(a) If
the Subscriber breaches any of the agreements, representations or warranties
which the Subscriber has made in his or her Subscription Agreement, the
Subscriber shall indemnify and hold harmless the Company (and its employees,
agents, and affiliates) against any claim, liability, loss, damage or expense
(including attorneys’ fees and other costs of investigating and litigating
claims) caused, directly or indirectly, by the Subscriber’s breach, provided,
however, that the obligation to indemnify will be limited to the amounts, if
any, received by the Subscriber from the sale of the Notes or the Underlying
Securities.
(b) If
the Company breaches any of the agreements, representations or warranties which
the Company has made in this Subscription Agreement, the Company shall indemnify
and hold harmless the Subscriber ( and its employees, agents and affiliates)
against any claim, liability, loss, damage or expense (including attorneys’ fees
and other costs of investigating and litigating claims) caused, directly or
indirectly, by the Company’s breach.
7. Confidentiality.
Information
concerning the Company is highly confidential and has been provided by the
Company to potential Subscribers solely for use in connection with this
Offering. This Subscription Agreement is personal to each offeree and
does not constitute an offer to any other person. Each prospective
purchaser, by accepting delivery of this Subscription Agreement, agrees not to
disclose to anyone, other than his or her professional advisors, any information
concerning the Company, agrees to make no copies of this Subscription Agreement
or any information concerning the Company, and if the offeree does not purchase
any Notes, to return this Subscription Agreement and any other written
information concerning the Company to the Company at the above address upon the
Company’s request.
8. Miscellaneous.
8.1 Governing Law; Choice of
Forum. This Subscription Agreement and the rights of the
parties hereunder shall be governed by and construed in accordance with the laws
of the State of New York applicable to agreements made and to be performed
entirely within New York. The parties hereto, by their execution
hereof, (i) agree that any such legal suit, action or proceeding arising from or
related to this Subscription Agreement may be instituted in a state or federal
court located in the City and State of New York; (ii) waive any objection which
they may now or hereafter have to the laying of venue of any such suit, action
or proceeding in any such court; and (iii) irrevocably submit to the
jurisdiction of any such court in any such suit, action or
proceeding.
8.2 Entire Agreement;
Waiver. This Subscription Agreement constitutes the entire
agreement between the parties and supersedes any prior agreements or
understandings between them. This Subscription Agreement may not be
modified in any manner unless in writing and signed by the party against whom
enforcement thereof is sought. No waiver of any breach or condition
of this Subscription Agreement shall be deemed to be a waiver of any subsequent
breach or condition of a like or different nature.
8.3 Binding
Effect. This Subscription Agreement and all the terms and
provisions hereof shall be binding upon and shall inure to the benefit of the
parties hereto, and their respective successors and permitted assigns; provided
that, this Subscription Agreement may not be assigned by Subscriber without the
Company’s prior written consent.
8.4 No Third Party
Beneficiaries. The provisions of this Subscription Agreement
and of any other agreement between the Company and Subscriber are solely for the
benefit of the Company and Subscriber and may be changed, terminated or revoked
in writing at any time by mutual agreement between the Company and Subscriber
without notice or liability to any other person.
8.5 Further
Assurances. Each of the parties hereto agrees to execute,
acknowledge, deliver, file, record and publish such further certificates,
instruments, agreements and other documents and to take all such further action
as may be required by law or as may be necessary or appropriate in order to
carry out the provisions of this Subscription Agreement.
8.6 Section
Headings. Section headings herein have been inserted for
reference only and shall not be deemed to limit or otherwise affect, in any
manner, or be deemed to interpret in whole or in part any of the terms or
provisions of this Subscription Agreement.
8.7 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 (a) the date of transmission, if such notice or
communication is delivered via facsimile prior to 5:30 p.m. (New York City time)
on a business day, (b) the next business day after the date of transmission, if
such notice or communication is delivered via facsimile on a day that is not a
business day or later than 5:30 p.m. (New York City time) on any business day,
(c) the business day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service, or (d) upon actual receipt by the party to
whom such notice is required to be given. The address and facsimile
number for such notices and communications shall be, for the Company, as set
forth on the first page hereof (facsimile number (▇▇▇) ▇▇▇-▇▇▇▇) and, for the
Subscriber, as set forth on the signature page hereof.
8.8 Execution. This
Subscription 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) with the same force and effect as if such facsimile signature page
were an original thereof.
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remainder of this page intentionally left blank.]
EXECUTION
PAGE
IN
WITNESS HEREOF, the Subscriber has executed this Subscription
Agreement.
SUBSCRIBER:
Name
(Print) ______________________
|
Address
|
||||
|
Street
|
City
|
State
|
Zip
|
Facsimile
Number: ___________________________
Social
Security Number or Tax Identification
Number:___________________________
Amount of
Notes subscribed for: $___________
Date ,
2010
Entity Name if applicable:
[ ]
Signature
Name (and
Title)
Acknowledged
and Accepted:
By:____________________________
Be sure
to include:
(1) one
signed copy of this Subscription Agreement;
(2) one
signed copy of Purchaser Questionnaire.
EXHIBIT
A
FORM OF CONVERTIBLE
NOTE
[Filed separately as
Exhibit 10.2]
EXHIBIT
B
TERM
SHEET FOR DEBT FINANCING AND AGREED UPON RESTRUCTURING
WITH
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, EFFECTIVE AS OF JANUARY 20, 2010
[Filed separately as
Exhibit 10.3]
EXHIBIT
C
OMNIMMUNE
HOLDINGS, INC. WIRE INSTRUCTIONS
[Intentionally
Omitted]