SECURITIES PURCHASE AGREEMENT by and between INverso Corp., a Delaware corporation on the one hand and William A. Hartman, an individual, on the other hand
by and
between
▇▇▇▇▇▇▇
Corp.,
a
Delaware corporation
on the
one hand
and
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇,
an
individual,
on the
other hand
This Securities Purchase Agreement
(this “Agreement”) is
entered into effective this 28th day of September, 2009 by and between ▇▇▇▇▇▇▇
Corp., a Delaware corporation (“▇▇▇▇▇▇▇”), on the one hand,
and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, an individual (“▇▇▇▇▇▇▇”), on the other
hand. Each of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ shall be referred to as a “Party” and collectively as the
“Parties.”
RECITALS
WHEREAS, ▇▇▇▇▇▇▇ is a development
stage company without significant assets or business, is subject to the
reporting requirements of the Securities Act of 1934, and is considered a blank
check company thereunder;
WHEREAS, ▇▇▇▇▇▇▇ intends to develop
medications and procedures responsive to human diseases and desires to obtain a
controlling ownership interest in ▇▇▇▇▇▇▇ in order to commercialize technologies
therein;
NOW, THEREFORE, for good and adequate
consideration, the receipt of which is hereby acknowledged, the Parties
covenant, promise and agree as follows:
AGREEMENT
1.
TRANSACTIONS: Within
Five (5) days of the Closing, subject to the terms and conditions of this
Agreement, the following shall occur:
(a) ▇▇▇▇▇▇▇
shall issue to ▇▇▇▇▇▇▇ a total of One Million Eight Hundred Fifty One Thousand
One Hundred Eleven (1,851,111) shares of its Series A Convertible Preferred
Stock (the “▇▇▇▇▇▇▇
Shares”). The rights, privileges and preferences of ▇▇▇▇▇▇▇’▇
Series A Convertible Preferred Stock is set forth in Exhibit
A. In exchange for the ▇▇▇▇▇▇▇ Shares, ▇▇▇▇▇▇▇ agrees to
accept an appointment as an officer and director of ▇▇▇▇▇▇▇.
2. REPRESENTATIONS, WARRANTIES
AND AGREEMENTS BY ▇▇▇▇▇▇▇: ▇▇▇▇▇▇▇ hereby represents, warrants
and agrees as follows:
(a) ▇▇▇▇▇▇▇
is a corporation duly organized, validly existing and in good standing under the
laws of Delaware, with full power and authority to own, lease, use, and operate
its properties and to carry on its business as and where now owned, leased,
used, operated and conducted. ▇▇▇▇▇▇▇ has all requisite corporate
power and authority to enter into and perform this Agreement and the other
Transaction Documents and to consummate and effect the transactions contemplated
by this Agreement.
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(b) All
consents, approvals, orders, or authorizations of, or registrations,
qualifications, designations, declarations, or filings with, any governmental
authority required on the part of ▇▇▇▇▇▇▇ in connection with the valid execution
and delivery of this Agreement, the offer, sale or issuance of the Shares or the
consummation of any other transaction contemplated hereby shall have been
obtained, except for notices required or permitted to be filed with certain
state and federal securities commissions, which notices will be filed on a
timely basis.
3.
REPRESENTATIONS,
WARRANTIES AND AGREEMENTS BY ▇▇▇▇▇▇▇: ▇▇▇▇▇▇▇ hereby
represents, warrants and agrees as follows:
(a) ▇▇▇▇▇▇▇
acknowledges that he has been furnished with such financial and other
information concerning ▇▇▇▇▇▇▇, the directors and officers of ▇▇▇▇▇▇▇, and the
business of ▇▇▇▇▇▇▇ as they consider necessary in connection with the issuance
of the ▇▇▇▇▇▇▇ Shares. As a result, he is familiar with the business,
operations, properties, and financial condition of ▇▇▇▇▇▇▇ and has discussed
with officers or directors of ▇▇▇▇▇▇▇ any questions he may have had with respect
thereto. He understands:
(i) The
risks involved in this investment, including the speculative nature of the
investment;
(ii) The
financial hazards involved in this investment, including the risk of losing
their entire investment;
(iii) The
lack of liquidity and restrictions on transfers of the ▇▇▇▇▇▇▇ Shares;
and
(iv)
The tax consequences of this investment.
▇▇▇▇▇▇▇
has consulted with his own legal, accounting, tax, investment and other advisers
with respect to the tax treatment, merits, and risks of the transactions
contemplated hereby.
(b) ▇▇▇▇▇▇▇
represents that he is acquiring the ▇▇▇▇▇▇▇ Shares solely for his own account
and beneficial interest for investment and not for sale or with a view to
distribution of the ▇▇▇▇▇▇▇ Shares or any part thereof, has no present intention
of selling (in connection with a distribution or otherwise), granting any
participation in, or otherwise distributing the same, and does not presently
have reason to anticipate a change in such intention.
(c) ▇▇▇▇▇▇▇
acknowledges that an investment in the ▇▇▇▇▇▇▇ Shares involves a high degree of
risk, and represents that he is able, without materially impairing his financial
condition, to hold the ▇▇▇▇▇▇▇ Shares for an indefinite period of time and to
suffer a complete loss of his investment.
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(d) ▇▇▇▇▇▇▇
has been advised that the ▇▇▇▇▇▇▇ Shares have not been registered under the
Securities Act of 1933, as amended (the “Act”), or qualified under the
securities law of any state, on the ground, among others, that no distribution
or public offering of the ▇▇▇▇▇▇▇ Shares is to be effected and the ▇▇▇▇▇▇▇
Shares will be issued by ▇▇▇▇▇▇▇ in connection with a transaction that does not
involve any public offering within the meaning of section 4(2) of the Act and/or
Regulation D as promulgated by the Securities and Exchange Commission under the
Act, and under any applicable state blue sky authority. They
understand that ▇▇▇▇▇▇▇ is relying in part on their representations as set forth
herein for purposes of claiming such exemptions and that the basis for such
exemptions may not be present if, notwithstanding their representations, they
have in mind merely acquiring the ▇▇▇▇▇▇▇ Shares for resale on the occurrence or
nonoccurrence of some predetermined event. ▇▇▇▇▇▇▇ has no such
intention.
(e) ▇▇▇▇▇▇▇
further acknowledges that the ▇▇▇▇▇▇▇ Shares are restricted securities under
Rule 144 of the Act, and, therefore, if ▇▇▇▇▇▇▇, in its sole discretion, chooses
to issue any certificates reflecting the ownership interest in the ▇▇▇▇▇▇▇
Shares, those certificates will contain a restrictive legend substantially
similar to the following:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”). THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.
Without
in any way limiting the representations set forth above, ▇▇▇▇▇▇▇ further agrees
not to make any disposition of all or any portion of the ▇▇▇▇▇▇▇ Shares unless
and until:
(i) There
is then in effect a Registration Statement under the Act covering such proposed
disposition and such disposition is made in accordance with such Registration
Statement; or
(ii) they
shall have obtained the consent of ▇▇▇▇▇▇▇ and notified ▇▇▇▇▇▇▇ of the proposed
disposition and shall have furnished ▇▇▇▇▇▇▇ with a detailed statement of the
circumstances surrounding the proposed disposition, and if reasonably requested
by ▇▇▇▇▇▇▇, they shall have furnished ▇▇▇▇▇▇▇ with an opinion of counsel,
reasonably satisfactory to ▇▇▇▇▇▇▇, that such disposition will not require
registration under the Act or any applicable state securities laws.
Notwithstanding
the provisions of subparagraphs (i) and (ii) above, no such registration
statement or opinion of counsel shall be necessary for a transfer by the holder
thereof to a partner (or retired partner) of the holder, or transfers by gift,
will or intestate succession to any spouse or lineal descendants or ancestors,
if all transferees agree in writing to be subject to the terms hereof to the
same extent as if they were purchasers hereunder as long as the consent of
▇▇▇▇▇▇▇ is obtained.
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(f) ▇▇▇▇▇▇▇
is an “accredited investor” as such term is defined in Rule 501 under the
Act. For purposes hereof, an “Accredited Investor” is one that
either:
(i) has
a net worth of at
least $1,000,000 (including home and personal property), or
(ii) had
an individual income of more than $200,000 in each of the two most recent
calendar years, and reasonably expects to have an individual income in excess of
$200,000 in the current calendar year; or along with Purchaser’s spouse had
joint income in excess of $300,000 in each of the two most recent calendar
years, and reasonably expects to have a joint income in excess of $300,000 in
the current calendar year.
For purposes of this Agreement,
“individual income” means “adjusted gross income” as reported for Federal income
tax purposes, exclusive of any income attributable to a spouse or to property
owned by a spouse: (i) the amount of any interest income
received which is tax-exempt under Section 103 of the Internal Revenue Code
of 1986, as amended, (the “Code”), (ii) the amount of losses claimed as a
limited partner in a limited partnership (as reported on Schedule E of form
1040), (iii) any deduction claimed for depletion under Section 611 et
seq. of the Code and (iv) any amount by which income from long-term capital
gains has been reduced in arriving at adjusted gross income pursuant to the
provisions of Sections 1202 of the Internal Revenue Code as it was in
effect prior to enactment of the Tax Reform Act of 1986.
For purposes of this Agreement, “joint
income” means, “adjusted gross income,” as reported for Federal income tax
purposes, including any income attributable to a spouse or to property owned by
a spouse, and increased by the following amounts: (i) the amount
of any interest income received which is tax-exempt under Section 103 of
the Internal Revenue Code of 1986, as amended (the “Code”), (ii) the amount of
losses claimed as a limited partner in a limited partnership (as reported on
Schedule E of Form 1040), (iii) any deduction claimed for
depletion under Section 611 et seq. of the Code and (iv) any
amount by which income from long-term capital gains has been reduced in arriving
at adjusted gross income pursuant to the provisions of Section 1202 of the
Internal Revenue Code as it was in effect prior to enactment of the Tax Reform
Act of 1986.
For the purposes of this Agreement,
“net worth” means (except as otherwise specifically defined) the excess of total
assets at fair market value, including home and personal property, over total
liabilities, including mortgages and income taxes on unrealized appreciation of
assets.
3. CONDITIONS
PRECEDENT. This Agreement, and the transactions contemplated
hereby, shall be subject to the following conditions precedent:
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(a) ▇▇▇▇▇▇▇
shall have entered into a License Agreement with each of ▇▇▇▇▇▇ Enterprises, LLC
and ▇▇▇▇ Enterprises, LLC with respect to certain patents and trademarks to be
used by ▇▇▇▇▇▇▇.
4. CLOSING. The
Closing (the “Closing”)
shall take place at the offices of The Lebrecht Group, APLC, counsel for
▇▇▇▇▇▇▇, ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, on
September 16, 2009, or at such other place, date and time as the Parties may
agree in writing (the “Closing
Date”).
5. CONFIDENTIALITY. Each
Party hereto will hold and will cause its agents, officers, directors,
attorneys, employees, consultants and advisors to hold in strict confidence,
unless compelled to disclose by judicial or administrative process or, in the
opinion of its counsel, by other requirements of law, all documents and
information concerning any other Party furnished it by such other Party or its
representatives in connection with the subject matter hereof (except to the
extent that such information can be shown to have been (i) previously known by
the Party to which it was furnished, (ii) in the public domain through no fault
of such Party, or (iii) later lawfully acquired from other sources by the Party
to which it was furnished), and each Party will not release or disclose such
information to any other person, except its auditors, attorneys, financial
advisors, bankers and other consultants and advisors in connection with this
Agreement. Each Party shall be deemed to have satisfied its
obligation to hold confidential information concerning or supplied by the other
Party if it exercises the same care as it takes to preserve confidentiality for
its own similar information. Notwithstanding the foregoing, the Parties
acknowledge that this Agreement shall be discussed in, and will be filed as an
exhibit to, ▇▇▇▇▇▇▇’▇ filings with the Securities and Exchange
Commission.
6. This
Agreement may not be amended, canceled, revoked or otherwise modified except by
written agreement subscribed by all of the Parties to be charged with such
modification.
7. This
Agreement shall be binding upon and shall inure to the benefit of the Parties
hereto and their respective partners, employees, agents, servants, heirs,
administrators, executors, successors, representatives and assigns.
8. All
Parties hereto agree to pay their own costs and attorneys' fees except as
follows:
(a) In
the event of any action, suit or other proceeding instituted to remedy, prevent
or obtain relief from a breach of this Agreement, arising out of a breach of
this Agreement, involving claims within the scope of the releases contained in
this Agreement, or pertaining to a declaration of rights under this Agreement,
the prevailing Party shall recover all of such Party's attorneys' fees and costs
incurred in each and every such action, suit or other proceeding, including any
and all appeals or petitions therefrom.
(b) ▇▇▇▇▇▇▇
will pay the legal fees related to the transactions contemplated by this
Agreement.
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(c) As
used herein, attorneys' fees shall be deemed to mean the full and actual costs
of any legal services actually performed in connection with the matters
involved, calculated on the basis of the usual fee charged by the attorneys
performing such services.
9. This
Agreement and the rights of the parties hereunder shall be governed by and
construed in accordance with the laws of the State of Pennsylvania including all
matters of construction, validity, performance, and enforcement and without
giving effect to the principles of conflict of laws. Venue for any
action brought under this Agreement shall be in the appropriate court in ▇▇▇▇▇▇
County, Pennsylvania.
10. The
Parties agree and stipulate that each and every term and condition contained in
this Agreement is material, and that each and every term and condition may be
reasonably accomplished within the time limitations, and in the manner set forth
in this Agreement.
11. The
Parties agree and stipulate that time is of the essence with respect to
compliance with each and every item set forth in this Agreement.
12. This
Agreement, along with the exhibits hereto, sets forth the entire agreement and
understanding of the Parties hereto and supersedes any and all prior agreements,
arrangements and understandings related to the subject matter
hereof. No understanding, promise, inducement, statement of
intention, representation, warranty, covenant or condition, written or oral,
express or implied, whether by statute or otherwise, has been made by any party
hereto which is not embodied in this Agreement or the written statements,
certificates, or other documents delivered pursuant hereto or in connection with
the transactions contemplated hereby, and no Party hereto shall be bound by or
liable for any alleged understanding, promise, inducement, statement,
representation, warranty, covenant or condition not so set forth.
13. This
Agreement may be executed in one or more counterparts, each of which when
executed and delivered shall be an original, and all of which when executed
shall constitute one and the same instrument.
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IN
WITNESS WHEREOF, the Parties hereto, agreeing to be bound hereby, execute this
Agreement upon the date first set forth above.
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“▇▇▇▇▇▇▇”
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“▇▇▇▇▇▇▇”
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▇▇▇▇▇▇▇
Corp.,
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a
Delaware corporation
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/s/ ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇,
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an
individual
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/s/ ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
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By: ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
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Its: Secretary
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EXHIBIT
A
RIGHTS,
PRIVILEGES, AND PREFERENCES
OF
▇▇▇▇▇▇▇
SERIES A CONVERTIBLE PREFERRED STOCK