EXHIBIT 10.02
PURCHASE AGREEMENT
This Purchase Agreement (this "Agreement") is made as of October 20,
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2000 between Nanopierce Technologies, Inc., a Nevada corporation (the
"Company"), and Harvest Court LLC (the "Purchaser").
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WHEREAS, subject to the terms and conditions set forth in this
Agreement, the Company desires to sell to the Purchaser and the Purchaser
desires to purchase from the Company certain shares (the "Initial Shares") of
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the Company's common stock, $0.0001 par value per share (the "Common Stock"),
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for an aggregate purchase price of $7,500,000; and
WHEREAS, on the Additional Closing Date (as defined herein), if any,
the Purchaser shall, subject to and upon the terms and conditions hereof,
purchase from the Company, and the Company shall sell to the Purchaser, certain
additional shares (the "Additional Shares" and together with the Initial Shares,
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the "Shares") of Common Stock for an additional aggregate purchase price of
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$7,500,000.
NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchaser agree
as follows:
1. Closings. (a) The closing of the sale of the Initial Shares
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(the "Initial Closing") shall take place at the offices of Xxxxxxxx Xxxxxxxxx
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Xxxxxx Aronsohn & Xxxxxx LLP ("Xxxxxxxx Xxxxxxxxx"), 1290 Avenue of the
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Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the date of this Agreement or such later
date or other location as the parties shall agree. The date of the Initial
Closing is hereinafter referred to as the "Initial Closing Date." At the
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Initial Closing: (A) the Company shall deliver to the Purchaser: (1) a stock
certificate representing a number of Initial Shares equal to the quotient
obtained by dividing: (x) 7,500,000 by (y) 80% of the average of the ten closing
bid prices of the Common Stock on the OTC Bulletin Board (as reported by
Bloomberg L.P. at 4:15 PM (New York time for the closing bid price for regular
session trading on such day)) during the consecutive ten Trading Days (as
defined below) immediately preceding the Initial Closing Date (the "Initial
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Purchase Price"), registered in the name of the Purchaser and free of all
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restrictive legends, (2) a Common Stock purchase warrant, in the form of Exhibit
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A, dated as of the Initial Closing Date and registered in the name of the
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Purchaser, pursuant to which the Purchaser shall have the right to acquire a
number of shares of Common Stock equal to 10% of the Initial Shares, upon the
terms and conditions set forth therein (the "Initial Warrant") and (3) a file
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copy of the Initial Supplement (as defined below) which shall be delivered no
later than the Trading Day immediately following the Initial Closing Date; and
(B) the Purchaser shall deliver $7,500,000 less the fees contemplated in Section
6(a) hereof, in immediately available funds by wire transfer to an account
designated in writing by the Company for such purpose. It shall be a condition
precedent to the Purchaser's
obligations to acquire and pay for the Initial Shares, that the Company file
with the Securities and Exchange Commission (the "Commission") a supplement to
the Registration Statement (as defined herein) in order to evidence the offer
and sale of the Initial Shares, Initial Reset Shares (as defined herein) and
shares of Common Stock issuable upon exercise of the Initial Warrant pursuant to
the terms hereunder and under the Registration Statement (the "Initial
Supplement"). "Trading Day" means: (a) a day on which the Common Stock is
traded, listed or quoted, as the case may be, on any of the Nasdaq SmallCap
Market, New York Stock Exchange, American Stock Exchange or Nasdaq National
Market, or (b) if the Common Stock is not listed on any of the Nasdaq SmallCap
Market, New York Stock Exchange, American Stock Exchange or Nasdaq National
Market, a day on which the Common Stock is traded in the over-the-counter
market, as reported by the OTC Bulletin Board, or (c) if the Common Stock is not
quoted on the OTC Bulletin Board, a day on which the Common Stock is quoted in
the over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding its functions of
reporting prices), provided, that in the event that the Common Stock is not
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listed or quoted as set forth in (a), (b) and (c) hereof, then Trading Day shall
mean any business day.
(b) Subject to the terms and conditions set forth in this Agreement,
the Company shall have the right to deliver a written notice to the Purchaser (a
"Subsequent Financing Notice") requiring the Purchaser to purchase, the
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Additional Shares for an aggregate purchase price of up to $7,500,000 (the
"Additional Purchase Price"). A Subsequent Financing Notice may be delivered no
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earlier than 195 Trading Days following the Initial Closing Date and no later
than 225 Trading Days following the Initial Closing Date, or as otherwise agreed
to by the parties. The closing of the purchase and sale of the Additional
Shares (the "Additional Closing" and together with the Initial Closing, a
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"Closing") shall take place at the offices of Xxxxxxxx Xxxxxxxxx on the fifth
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(5/th/) business day after the Subsequent Financing Notice is deemed delivered
hereunder or on such other date as otherwise agreed to by the parties; provided,
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that in no case shall the Additional Closing take place unless and until all of
the conditions listed in Section 5 have been satisfied by the Company or waived
by the Purchaser. The date of the Additional Closing is hereinafter referred to
as the "Additional Closing Date." Notwithstanding anything herein to the
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contrary, if the product of: (x) the average of the daily trading volume of the
Common Stock on the OTC Bulletin Board for the twenty consecutive Trading Days
immediately preceding the Additional Closing Date and (y) the average of the
volume weighted average price of the Common Stock on the OTC Bulletin Board (as
reported by Bloomberg L.P. at 4:15 PM (New York time) for regular session
trading on such day) for the twenty consecutive Trading Days immediately
preceding the Additional Closing Date (such product, the "Average Price") shall
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be equal to or less than $200,000, then the Additional Purchase Price shall
equal the product of: (x) the quotient obtained by dividing the Average Price by
200,000 and (y) 7,500,000.
(c) At the Additional Closing, if any: (A) the Company shall deliver
to the Purchaser: (1) a stock certificate representing a number of Additional
Shares equal to the quotient obtained by dividing: (x) the Additional Purchase
Price by (y) 80% of the average of the ten closing bid prices of the Common
Stock on the OTC Bulletin Board (as reported by Bloomberg L.P. at 4:15 PM (New
York time for the closing bid price for regular session trading on such day))
during the ten Trading
Days immediately preceding the Additional Closing Date (the "Additional Purchase
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Price"), registered in the name of the Purchaser and free of all restrictive
legends, (2) a Common Stock purchase warrant, in the form of Exhibit A, dated as
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of the Additional Closing Date and registered in the name of the Purchaser,
pursuant to which the Purchaser shall have the right to acquire a number of
shares of Common Stock equal to 10% of the Additional Shares, upon the terms and
conditions set forth therein (the "Additional Warrant" and together with the
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Initial Warrant, the "Warrants") and (3) a prospectus supplement to the
Registration Statement disclosing the sale of the Additional Shares, Additional
Reset Shares (as defined herein) and shares of Common Stock issuable upon
exercise of the Additional Warrant pursuant to the terms hereunder and under the
Registration Statement (the "Additional Supplement") which shall be delivered on
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the Trading Day immediately following the Additional Closing Date; and (B) the
Purchaser shall deliver the Additional Purchase Price less $2,500 to be paid to
Xxxxxxxx Xxxxxxxxx in payment of the Purchaser's legal fees in connection with
the Additional Closing, in immediately available funds by wire transfer to an
account designated in writing by the Company for such purpose. It shall be a
condition precedent to the Purchaser's obligations to acquire and pay for the
Additional Shares that the Company file with the Commission the Additional
Supplement.
2. Representations and Warranties of the Company. The Company
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hereby makes the following representations and warranties to the Purchaser as of
the date hereof:
(a) Organization and Qualification. The Company is a corporation
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duly incorporated, validly existing and in good standing under the laws of the
State of Nevada with the requisite corporate power and authority to own and use
its properties and assets and to carry on its business as currently conducted.
(b) Authorization. The Company has the requisite corporate power and
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authority to enter into and to consummate the transactions contemplated by this
Agreement and otherwise to carry out its obligations hereunder. The execution
and delivery of this Agreement and the Warrants by the Company and the
consummation by it of the transactions contemplated thereby have been duly
authorized by all necessary action on the part of the Company and no further
action is required by the Company other than the filings with the Commission of
the prospectus supplements described herein. This Agreement has been duly
executed by the Company and, assuming the valid execution thereof by the
Purchaser, when delivered in accordance with the terms hereof, will constitute
the valid and binding obligation of the Company enforceable against the Company
in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' and contracting parties' rights generally and except as
enforceability may be subject to general principles of equity (regardless of
whether such enforceability in a proceeding in equity or at law).
(c) Capitalization. The authorized, issued and outstanding capital
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stock of the Company is set forth in Schedule 2.1(c). Except as disclosed in
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Schedule 2.1(c), the Company owns all of the capital stock of each of its
subsidiaries. No shares of Common Stock are entitled to preemptive or similar
rights, nor is any holder of the securities of the Company or any subsidiary
of the Company entitled to preemptive or similar rights arising out of any
agreement or understanding with the Company or any subsidiary by virtue of the
transactions contemplated by this Agreement. Except as contemplated by this
Agreement or as disclosed in Schedule 2.1(c), there are no outstanding options,
warrants, script rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or
exchangeable for, or giving any person any right to subscribe for or acquire,
any shares of Common Stock, or contracts, commitments, understandings, or
arrangements by which the Company or any subsidiary of the Company is or may
become bound to issue additional shares of Common Stock, or securities or rights
convertible or exchangeable into shares of Common Stock. Except as disclosed in
Schedule 2.1(c), the issue and sale of the Securities (as hereinafter defined)
pursuant to the terms hereof will not obligate the Company to issue shares of
Common Stock or other securities to any person other than the Purchaser and will
not result in a right of any holder of Company securities to adjust the exercise
or conversion or reset price under any securities of the Company held by such
holders.
(d) No Conflicts. The execution, delivery and performance of this
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Agreement and the Warrants by the Company and the consummation by the Company of
the transactions contemplated hereby does not and will not: (i) conflict with or
violate any provision of the Company's certificate or articles of incorporation,
bylaws or other charter documents (each as amended through the date hereof), or
(ii) conflict with, or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other
instrument or other understanding to which the Company is a party or by which
any material property or asset of the Company is bound or affected, or (iii)
result in a violation of any law, rule, regulation, order, judgment, injunction,
decree or other restriction of any court or governmental authority to which the
Company is subject (including federal and state securities laws and
regulations).
(e) Issuance of the Shares. The Company has on the date hereof (and
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will, at all times while the Warrants are outstanding, maintain) an adequate
reserve of duly authorized shares of Common Stock, reserved for issuance to the
Purchaser, to enable the Company to perform the exercise and other obligations
under this Agreement and the Warrants. Such number of reserved and available
shares of Common Stock shall not be less than 4,984,774. The shares of Common
Stock issuable upon exercise of the Warrants are collectively referred to herein
as the "Underlying Shares." The Shares, Reset Shares (as defined herein),
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Warrants and the Underlying Shares are collectively referred to herein as, the
"Securities." When issued in accordance with the Warrants, the Underlying
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Shares will be duly authorized, validly issued, fully paid and nonassessable,
free and clear of all liens, encumbrances and rights of first refusal of any
kind.
(f) Registration Statement. The Company's Registration Statement on
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Form S-3 (Commission File No. 333-35358) (the "Registration Statement") was
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declared effective by the Commission on May 25, 2000 and the Company has not
received notice that the Commission has issued or intends to issue a stop order
with respect to the Registration Statement or that the Commission otherwise has
suspended or withdrawn the effectiveness of the Registration Statement,
either temporarily or permanently, or intends or has threatened in writing to do
so. The Registration Statement (including the information or documents
incorporated by reference therein), as of the time it was declared effective,
and any amendments or supplements thereto, each as of the time of filing, did
not contain any untrue statement of material fact or omit to state any material
fact required to be state therein or necessary to make the statements therein
not misleading. The issuance of the Shares, Reset Shares (if applicable) and
Underlying Shares to the Purchaser is covered by the Registration Statement.
$30,000,000 of shares of Common Stock (including shares of Common Stock issuable
upon exercise of warrants) remain unused and unreserved under the Registration
Statement.
(g) SEC Documents; Financial Statements. The Company has filed all
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reports required to be filed by it under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), including, without limitation, all filings
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required pursuant to Sections 13(a) and 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company was required by
law to file such material) (the foregoing materials being collectively referred
to herein as the "SEC Documents") on a timely basis or has received a valid
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extension of such time of filing and has filed any such SEC Documents prior to
the expiration of any such extension. As of their respective dates, the SEC
Documents complied in all material respects with the requirements of the
Securities Act of 1933, as amended (the "Securities Act") and the Exchange Act
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and the rules and regulations of the Commission promulgated thereunder, and none
of the SEC Documents, when filed, contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. All material agreements to which
the Company is a party or to which the property or assets of the Company are
subject have been filed as exhibits to the SEC Documents as required under the
Exchange Act. The financial statements of the Company included in the SEC
Documents comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with respect
thereto as in effect at the time of filing. Such financial statements have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis during the periods involved ("GAAP"), except as may be
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otherwise specified in such financial statements or the notes thereto, and
fairly present in all material respects the financial position of the Company
and its consolidated subsidiaries as of and for the dates thereof and the
results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit adjustments.
Since June 30, 2000, except as specifically disclosed in the SEC Documents: (a)
there has been no event, occurrence or development that has or that could result
in a material adverse effect on the results of operations, assets, prospects, or
condition (financial or otherwise) of the Company and its subsidiaries, taken as
a whole, (b) the Company has not incurred any liabilities (contingent or
otherwise) other than (x) liabilities incurred in the ordinary course of
business consistent with past practice and (y) liabilities not required to be
reflected in the Company's financial statements pursuant to GAAP or required to
be disclosed in filings made with the Commission, (c) the Company has not
altered its method of accounting or the identity of its auditors and (d) the
Company has not declared or made any payment or distribution of cash or other
property to its stockholders or officers or directors (other than in compliance
with existing Company stock option plans) with respect to its capital stock, or
purchased, redeemed (or made any agreements to purchase or redeem) any shares of
its capital stock.
(h) Certain Fees. The Purchaser shall have no obligation with
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respect to any fees incurred by the Company or any other person (other than the
Purchaser, if the Purchaser has agreed in writing to pay such fees) or with
respect to any claims made by or on behalf of other persons for fees of a type
contemplated in this Section that may be due in connection with the transactions
contemplated by this Agreement. Except for the fee payable by the Company to
Allied Capital International in connection with the transactions contemplated by
this Agreement, the Company shall indemnify and hold harmless the Purchaser, its
employees, officers, directors, agents, and partners, and its affiliates, from
and against all claims, losses, damages, costs (including the costs of
preparation and attorney's fees) and expenses suffered in respect of any such
claimed or existing fees incurred by the Company or any other person (other than
the Purchaser, if the Purchaser has agreed in writing to pay such fees), as such
fees and expenses are incurred.
(i) Disclosure. The Company confirms that neither it nor any other
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person acting on its behalf has provided the Purchaser or its agents or counsel
with any information that constitutes or might constitute material non-public
information. The Company understands and confirms that the Purchaser shall be
relying on the foregoing representations in effecting transactions in securities
of the Company. All disclosure provided to the Purchaser regarding the Company,
its business and the transactions contemplated hereby are true and correct and
do not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein, in light
of the circumstances under which they were made, not misleading.
3. Representations and Warranties of the Purchaser. The Purchaser
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represents, warrants and covenants to the Company as follows:
(a) Organization; Authorization. The Purchaser is an entity duly
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organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. The Purchaser has full right, power,
authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement. Upon the execution
and delivery of this Agreement, and assuming the valid execution thereof by the
Company, this Agreement shall constitute the valid and binding obligation of
such Purchaser enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(b) No Conflicts. The execution, delivery and performance of this
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Agreement by the Purchaser and the consummation by the Purchaser of the
transaction contemplated hereby does not and will not violate its organizational
documents or any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which the Purchaser
is subject (including federal and state securities laws and regulations).
(c) Broker-Dealer. The Purchaser is not a broker-dealer registered
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with the Commission nor is the Purchaser a member of the National Association of
Securities Dealers.
(d) Receipt of Prospectus. The Purchaser has heretofore received a
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copy of the base prospectus to the Registration Statement.
(e) Resales of Securities. Any resales of the Securities shall be
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made in accordance with the Securities Act and the rules and regulations
promulgated thereunder.
4. Additional Agreements of the Company
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(a) Issuance of additional shares of Common Stock. (i) On each of
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the 65/th/, 130/th/ and 195/th/ Trading Day following the Initial Closing Date
(each of such three dates, an "Initial Reset Date"), the Company shall issue to
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the Purchaser a stock certificate, registered in the name of the Purchaser and
free of all restrictive legends, representing a number of shares of Common Stock
(the "Initial Reset Shares") calculated in accordance with the following
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formula:
(1/3 of the Initial Shares) x [(Initial Purchase Price)(Initial Percentage) -
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Initial Adjustment Price)]
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Initial Adjustment Price
"Initial Percentage" shall mean: (i) for the first Initial Reset Date,
115%, (ii) for the second Initial Reset Date, 125% and (iii) for the third
Initial Reset Date, 140%.
"Initial Adjustment Price" shall mean the average of the twenty two lowest
closing bid prices of the Common Stock on the OTC Bulletin Board (as
reported by Bloomberg L.P. at 4:15 PM (New York time for the closing bid
price for regular session trading on such day)) during the 65 Trading Days
immediately preceding the applicable Initial Reset Date, provided that such
65 Trading Day period shall, at the option of the Purchaser, be extended
for the number of Trading Days during such period in which the Registration
Statement ceases to register or remain effective as to all Shares, Reset
Shares and Underlying Shares.
If the number calculated in accordance with the foregoing formula is zero
or a negative number, no Initial Reset Shares shall be issuable by the Company
hereunder and the Purchaser shall not be obligated to transfer any shares of
Common Stock to the Company.
(ii) On each of the 65/th/, 130/th/ and 195/th/ trading day following
the Additional Closing Date, if any (each of such three dates, a "Additional
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Reset Date"), the Company shall issue to the Purchaser a stock certificate,
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registered in the name of the Purchaser and free of all restrictive legends,
representing a number of shares of Common Stock (the "Additional Reset Shares"
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and together with the Initial Reset Shares, the "Reset Shares") calculated in
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accordance with the following formula:
(1/3 of the Additional Shares) x [(Additional Purchase Price)(Additional
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Percentage) - Additional Adjustment Price)]
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Additional Adjustment Price
"Additional Percentage" shall mean: (i) for the first Additional Reset
Date, 115%, (ii) for the second Additional Reset Date, 125% and (iii) for
the third Additional Reset Date, 140%.
"Additional Adjustment Price" shall mean the average of the twenty two
lowest closing bid prices of the Common Stock on the OTC Bulletin Board (as
reported by Bloomberg L.P. at 4:15 PM (New York time for the closing bid
price for regular session trading on such day)) during the 65 Trading Days
immediately preceding the applicable Additional Reset Date, provided that
such 65 Trading Day period shall, at the option of the Purchaser, be
extended for the number of Trading Days during such period in which the
Registration Statement ceases to register or remain effective as to all
Shares, Reset Shares and Underlying Shares.
If the number calculated in accordance with the foregoing formula is zero
or a negative number, no Additional Reset Shares shall be issuable by the
Company hereunder and the Purchaser shall not be obligated to transfer any
shares of Common Stock to the Company.
(b) Subsequent Financing. From the date hereof through the first year
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anniversary of the last Closing Date to occur, the Company will not offer, sell,
grant any option to purchase, or otherwise dispose of (or announce any offer,
sale, grant or any option to purchase or other disposition) any of its equity or
equity equivalent securities (including the issuance of any debt or other
instrument at any time over the life thereof convertible into or exchangeable
for Common Stock) at a price which is less than the average of the ten closing
bid prices of the Common Stock on the OTC Bulletin Board (as reported by
Bloomberg L.P. at 4:15 PM (New York time for the closing bid price for regular
session trading on such day)) during the ten Trading Days (as defined below)
immediately preceding the issuance date thereof. The restrictions contained in
this paragraph shall not apply to the granting of options to employees, officers
or directors of the Company, and the issuance of Common Stock upon exercise of
such options granted under any stock option plan heretofore or hereinafter duly
adopted by the Company.
(c) Registration. On each Initial Reset Date and each Additional Reset
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Date on which the Company shall issue Reset Shares pursuant to the terms hereof,
the Company shall file a supplement to the Registration Statement in order to
evidence the issuance of such Reset Shares. If, while the Purchaser holds
Securities, the Registration Statement ceases to register or remain effective as
to 115% of the Shares, Reset Shares and Underlying Shares, (assuming the Warrant
then held by the Purchaser is fully exercised on such date) then held by the
Purchaser (such securities, the "Registrable Securities"), then the Company
shall as soon as possible, but in any event within 15 business days of such
event, prepare and file with the Commission such amendments or supplements to
the Registration Statement, or such additional registration statements (as the
case may be), as may be required to register such Registrable Securities.
(d) Liquidated Damages. If, while the Purchaser holds Securities, the
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Registration Statement ceases to be effective as to all Securities to which it
is required to relate for a period in excess of ten Trading Days then, on such
tenth Trading Day and each tenth Trading Day thereafter until the Registration
Statement becomes effective as to all Securities to which it is required to
relate, the Company shall pay to the Purchaser an amount in cash, as liquidated
damages and not as penalty, equal to 3.0% of the closing bid price of the Shares
and Reset Shares then held by the Purchaser. If the Company fails to pay any
liquidated damages pursuant to this Section in full within seven days after the
date payable, the Company will pay interest thereon at a rate of 15% per annum
(or such lesser maximum amount that is permitted to be paid by applicable law) ,
accruing daily from the date
such liquidated damages become due until such amounts, plus all such interest
thereon, are paid in full. The liquidated damages pursuant to the terms hereof
shall apply on a pro-rata basis for any portion of a ten-day period prior to a
cure hereunder.
5. Conditions precedent to the Additional Closing. Notwithstanding
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anything to the contrary contained in this Agreement, the obligation of the
Purchaser to purchase the Additional Shares and Additional Warrant is subject to
the satisfaction by the Company or waiver by the Purchaser of each of the
following conditions:
(a) Closing of Initial Shares. The Initial Closing shall have occurred;
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(b) Accuracy of the Company's Representations and Warranties. The
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representations and warranties of the Company contained in this Agreement shall
be true and correct as of the date when made and as of the Additional Closing
Date as though made on and as of the Additional Closing Date (other than
representations and warranties which relate to a specific date which
representations and warranties shall be true as of such specific date);
(c) Performance by the Company. The Company shall have performed,
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satisfied and complied with all covenants, agreements and conditions required by
this Agreement and the Warrants to be performed, satisfied or complied with by
the Company between the Initial Closing Date and the Additional Closing Date;
(d) Registration Statement. The Registration Statement (as supplemented
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pursuant to the terms hereof) shall have remained effective at all times, not
subject to any actual or threatened stop order or subject to any actual or
threatened suspension at any time prior to the Additional Closing Date;
(e) No Injunction. Since the Initial Closing Date, no statute, rule,
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regulation, executive order, decree, ruling or injunction shall have been
enacted, entered, promulgated, amended, modified or endorsed by any court of
governmental authority of competent jurisdiction or governmental authority,
stock market or trading facility which prohibits the consummation of any of the
transactions contemplated by this Agreement or makes impracticable the
transactions contemplated thereby;
(f) No Suspensions of Trading in Common Stock. The trading in the Common
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Stock shall not have been suspended by the Commission or on the OTC Bulletin
Board or the Nasdaq SmallCap Market at any time since the Initial Closing Date
and the Common Stock shall have been at all times since the Initial Closing Date
listed for trading on the OTC Bulletin Board or the Nasdaq SmallCap Market;
(g) Additional Supplement. The Company shall have filed the Additional
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Supplement with the Commission; and
(h) Market Price of the Common Stock. The closing bid price of the Common
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Stock on the OTC Bulletin Board or the Nasdaq SmallCap Market (as reported by
Bloomberg L.P. at 4:15 PM (New York time for the closing bid price for regular
session trading on such day)) during each of the thirty Trading Days immediately
preceding and including the Additional Closing Date shall equal or exceed the
Initial Purchase Price.
6. Miscellaneous. (a) Fees and Expenses. At the Initial Closing, the
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Company shall reimburse the Purchaser for its: (i) legal fees and expenses
incurred in connection with the preparation and negotiation of this Agreement by
paying to Xxxxxxxx Xxxxxxxxx $25,000 and (ii) due diligence expenses in
connection with the preparation and negotiation of this Agreement by paying to
the Purchaser $15,000. The amounts contemplated by the immediately preceding
sentence shall be retained by the Purchaser and shall not be delivered to the
Company. Other than the amounts contemplated herein, each party shall pay the
fees and expenses of its advisers, counsel, accountants and other experts, if
any, and all other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement. The Company
shall pay all stamp and other taxes and duties levied in connection with the
sale of the Shares.
(b) Publicity and Communications. Neither the Company nor the Purchaser
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shall issue any press release or make any other public announcement relating to
this Agreement unless the content thereof is mutually agreed to by the Company
and the Purchaser, or if the Company is advised in writing by its counsel that
such press release or public announcement is required by law. Following the date
of this Agreement, neither the Company nor any person acting on its behalf shall
provide the Purchaser or its agents any information that is likely to constitute
material non-public information regarding the Company or its subsidiaries.
(c) Entire Agreement; Amendments. This Agreement contains the entire
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understanding of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge have been merged into
such documents, exhibits and schedules. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and
the Purchaser. The waiver by either party hereto of any right hereunder or the
failure to perform or of a breach by the other party shall not be deemed a
waiver of any other right hereunder or of any other breach or failure by said
other party whether of a similar nature or otherwise.
(d) Notices. Any and all notices or other communications or deliveries
-------
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of (i) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile
telephone number specified in this Section prior to 6:30 p.m. (New York City
time) on a business day, (ii) the business day after the date of transmission,
if such notice or communication is delivered via facsimile at the facsimile
telephone number specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the business day following the date of mailing, if sent by nationally
recognized overnight courier service, or (iv) upon actual receipt by the party
to whom
such notice is required to be given. The address for such notices and
communications shall be as follows:
If to the Company: Nanopierce Technologies, Inc.
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Chief Financial Officer
With copies to: Xxxxx Xxxx LLP
000 Xxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Facsimile No.: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxxx, Esq.
If to the Purchaser: To the address set forth under the Purchaser's
name on its signature page hereto.
or such other address as may be designated in writing hereafter, in the same
manner, by such person.
(e) Governing Law. The corporate laws of the State of Nevada shall
-------------
govern all issues concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein (including with respect to
the enforcement of this Agreement), and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action
or proceeding is improper. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.
(f) Execution. This Agreement may be executed in two or more
---------
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature page were an original
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOLLOW]
IN WITNESS WHEREOF, the parties hereto have caused this Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first
indicated above.
NANOPIERCE TECHNOLOGIES, INC.
By:____________________________________
Name:
Title:
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES OF THE PURCHASER FOLLOW]
HARVEST COURT LLC
By:_____________________________________
Name:
Title:
Address for Notice:
Address for Notice: Harvest Court LLC
x/x Xxxxx Xxxxxxxx (Xxxxxx) Limited
Commercial Centre
P.O. Box 31106 SMB
Grand Cayman
Cayman Islands
British West Indies
Facsimile No.: (000) 000-0000
With copies to: Xxxxxxxx Xxxxxxxxx Xxxxxx Xxxxxxxx & Xxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000 and (000) 000-0000
Attn: Xxxx X. Xxxxx, Esq.
Schedule 2.1(c)
Nanopierce Technologies, Inc.
Capitalization Schedule
October 19, 2000
Issued &
Security Authorized Outstanding
------------------------------------------------------------------------------------------------------------
Preferred Stock 5,000,000 0
Common Stock 100,000,000 36,384,290
Gemini Investment Warrants* 10,000,000
Warrants 1,517,500
Management & Employee Options 7,500,000 6,792,000
------------------------------------------------------------------------------------------------------------
Fully Diluted
Common Stock 36,384,290
Gemini Investment Warrants* 10,000,000
Warrants 1,517,500
Management & Employee Options 6,792,000
----------
Fully Diluted 54,693,790
------------------------------------------------------------------------------------------------------------
___________________
* The holder of these warrants has informed the Company that it intends to
exercise some or all of these warrants on October 19, 2000.
1
WARRANTS
No. of Issue Date Exp. Date Price
Shares
--------------------------------------------------
120,000
10,000,000* 10/19/00 10/19/00 $ 0.25
105,000 10/26/99 10/26/02 $ 0.30
52,500 10/27/99 10/27/02 $ 0.30
70,000 10/27/99 10/27/02 $ 0.30
70,000 10/27/99 10/27/02 $ 0.30
140,000 11/8/99 11/8/02 $ 0.30
70,000 11/22/99 11/22/02 $ 0.30
70,000 12/17/99 12/17/02 $ 0.30
70,000 1/4/00 1/4/03 $ 1.50
70,000 1/4/00 1/4/03 $ 1.50
46,000 1/11/00 1/10/03 $2.915
400,000 1/11/00 1/10/03 $2.915
62,000 1/11/00 1/10/03 $2.915
60,000 1/11/00 1/10/03 $2.915
62,000 1/11/00 1/10/03 $2.915
50,000 1/11/00 1/10/03 $2.915
__________
* The holder of these warrants has informed the Company that it intends to
exercise some or all of these warrants on October 19, 2000.
2
