Exhibit 4.8
American Bio Medica Corp.
STOCK GRANT AGREEMENT
THIS STOCK GRANT AGREEMENT (this "Agreement") is entered into by BARRETTO
PACIFIC CORPORATION (the "Grantee") and American Bio Medica Corp. (the
"Company"). This Agreement is entered into in connection with the Grantee's
receipt of securities of Company, and is a condition to the issuance by the
Company of such securities as contemplated herein.
1. Securities Granted. Company hereby grants to Grantee seventy five thousand
(75,000) shares of the Company's $0.01 par value common stock (such shares
and any securities which may be issued to Grantee with respect to such
shares, whether pursuant to a stock split, stock dividend, or otherwise,
are referred to herein as the "Securities"). The Securities are being
granted to Grantee as compensation for the services to be provided by
Grantee to the Company pursuant to that certain Services Agreement
effective September 7, 2005 by and between the Grantee and the Company
(the "Services Agreement"), which is attached hereto and incorporated
herein by reference.
2. Delivery of Stock Certificate. Promptly after execution of this Agreement
by the Grantee and the Company, a certificate representing the Securities
will be issued and registered in the name of the Grantee and delivered to
the Company. As set forth in the Services Agreement, Company shall
temporarily retain possession of the certificate.
3. Investment Intent. Grantee represents and warrants to Company as follows:
(a) Grantee has been advised that (i) the grant of the Securities to Grantee
has not been registered under the Securities Act of 1933 ( the "Act") on
the grounds, among others, that (i) it will be exempt from registration
under Section 4(2) of the Act as a transaction not involving a public
offering; (ii) reliance upon such exemption or exemptions is predicated in
part on Grantee's representation that Grantee is acquiring such Securities
for investment for Grantee's own account with no present intention of
dividing Grantee's participation with others or reselling or otherwise
distributing the same, and the Grantee alone shall have the full legal and
equitable right, title and interest in the Securities; and (iii) Grantee's
representations, including the foregoing, are essential to the reliance of
the Company upon exemptions from registration or qualifications of this
transaction or the Securities under applicable state securities laws.
(b) Grantee understands that the effect and intent of Grantee's
representations in subparagraph 3(a) above to be that Grantee does not
presently contemplate the disposal of all or any part of the Securities,
and that at such time as Grantee determines to dispose of all or any part
of the Securities, Grantee understands that Grantee must first notify the
Company, and that the Company may require an opinion of its attorney, of
Grantee's attorney, or both, that such disposition will not negate
Grantee's intent as expressed herein, and that in view of the exemption
claimed, such disposition will be permissible.
(c) Grantee understands that the subsequent transfer of the Securities will be
restricted, and that the effect of the restrictions on the transfer of the
Securities include the facts, among others, that (i) Grantee will not have
liquidity with respect to the Securities for an indefinite period of time
and in no event less than one year from the date of grant, and (ii)
Grantee will be unable to sell, encumber or otherwise transfer the
Securities unless there is an effective registration statement covering
such disposition under the Act, and effective registrations and
qualifications under applicable state law, or exemptions from such
registrations or qualifications under the Act and state law are
applicable.
1
(d) Grantee recognizes that the Securities are a long-term investment. Grantee
has a financial net worth or anticipated income such that a sale of such
Securities need not be made in the foreseeable future to satisfy any
financial obligation of which Grantee is or which Grantee contemplates
Grantee will become subject.
(e) Grantee understands that exemptions from the registration and
qualification requirements, as referred to in subparagraph 3(c) above, may
not be available to Grantee, and the Company will have no obligation to
assist Grantee in registering or qualifying a disposition of the
Securities or in obtaining or establishing an exemption from such a
registration or qualification requirements.
(f) Grantee understands that any certificate representing the Securities will
bear legends stating in effect that the issuance of the Securities and
resale of the Securities have not been registered under the Act or any
applicable state securities laws and such legends may refer to the
restrictions or transfers and sales contained in this Agreement. Grantee
further understands that a stop-transfer restriction may be placed in the
books and records of the Company with respect to the Securities.
(g) Grantee's acquisition of the Securities is not the result of any general
solicitation or general advertising, including, but not limited to: (i)
any advertisement, article, notice or other communication media or
broadcast over television or radio; and (ii) any seminar or meeting whose
attendees have been invited by any general solicitation or general
advertising.
4. State of Residence. Grantee represents and warrants to the Company that
the Grantee is a corporation governed by the laws of the State of Nevada
and that its principal executive offices are located at 0000 Xxxx Xxxxx,
Xxxxx 00, Xxx 0, Xxxxxxx, XX 00000.
5. Representation Regarding Accredited Grantee Status.
(a) Please indicate below whether the Grantee is an "Accredited Investor, " as
defined in Rule 501 (a) of Regulation D under the Act:
Yes: ___x___
No: _______
(b) If the Grantee is an Accredited Investor, this representation is
based on the following (please indicate one or more, as applicable):
___ (1) The Grantee has total assets in excess of $5,000,000 and was
not formed for the specific purpose of acquiring shares of the Company.
_x_ (2) The Grantee is an entity, all of whose equity owners are
accredited investors. (Please provide written representation of accredited
investor status from each equity owner using Attachment A hereto.)
___ (3) The Grantee otherwise qualifies as an Accredited Investor.
(Please explain qualifications): _______________________________________________
6. Knowledge and Experience. Grantee represents and warrants to the Company
as follows:
(a) Grantee has such knowledge and experience in financial and business maters
that Grantee is capable of evaluating the merits and risks of the
prospective ownership of the Securities.
(b) Grantee has obtained, to the extent Grantee deems necessary, personal and
professional advice with respect to the risks inherent in the ownership of
the Securities in light of Grantee's financial condition and investment
needs.
2
(c) Grantee has been given access to full and complete information regarding
the Company and has utilized such access to its satisfaction for the
purpose of obtaining information; and particularly, Grantee has been given
reasonable opportunity to meet with representatives of the Company for the
purpose of asking questions of, and receiving answers from, such
representatives concerning the Company and the Securities and to obtain
any additional information, to the extent reasonably available. Grantee
acknowledges that it has had satisfactory opportunity to review and
consider all of the Company's publicly available reports and documents
filed with the Securities and Exchange Commission to the extent deemed
appropriate by the Grantee.
7. Lack of Availability of Rule 144 Under the Act. The Grantee understands
and acknowledges that the Company has no obligation to undertake or
complete a public sale of the Securities and that the Securities will
remain subject to the restrictions on transferability described in this
Agreement. The Grantee further understands and acknowledges that although
the Company currently files periodic reports with the Securities and
Exchange Commission pursuant to the requirements of Sections 13 or 15(d)
of the Securities Exchange Act of 1934, as amended, it may not be
obligated to file such reports at any time in the future. The Grantee also
understands that the Company has not agreed to supply such other
information as would be required to enable routine sales of the Company's
common stock to be made under the provisions of certain rules respecting
"restricted securities," including Rule 144 promulgated under the Act by
the Securities Exchange Commission. Thus, the Grantee has been informed
that the Company is not obligated to make publicly available or to provide
the Grantee with the information required by Rule 144.
8. Correctness of Information; Changes. All of the foregoing information
which the Grantee has provided concerning Grantee, Grantee's financial
position and Grantee's knowledge of financial and business matters, is
correct and complete as of the date set forth at the end hereof.
9. Indemnification. Grantee agrees to indemnify the Company against and to
hold the Company harmless from any damage, loss, liability, claim or
expense including, without limitation, reasonable attorneys' fees,
resulting from or arising out of the inaccuracy or alleged inaccuracy of
any of the representations, warranties or statements of the Grantee
contained in this Agreement, including without limitation any violation or
alleged violation of the registration requirements of the Act or
applicable state law in connection with any subsequent sale of the
Securities by Grantee.
10. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the state of New York
without reference to such state's conflict or choice of law provisions.
Actions litigated in connection with this Agreement, if any, shall have
their venue exclusively in the state and federal courts located in the
State of New York.
11. Additional Information. Grantee shall supply such additional information
and documentation relating to Grantee and any persons who have any rights
or interest in Grantee as may be requested by the Company in order to
ensure compliance by the Company with applicable laws.
12. Successors and Assigns. The representations and warranties made by the
Grantee in this Agreement are binding on the Grantee's successors and
assigns and are made for the benefit of the Company and any other person
who may become liable for violations of applicable securities laws as a
result of the inaccuracy or falsity of any of the Grantee's
representations or warranties.
13. Counterparts. This Agreement may be executed by the Company and by the
Grantee in separate and several counterparts, each of which shall be
deemed an original.
3
14. Entire Agreement; Amendment. This Agreement and the Services Agreement
represent the entire agreement of the parties regarding the subject matter
hereof and may not be amended by any prior or contemporaneous oral or
written representation. This Agreement may be amended only by a writing
signed by the party to be charged therewith.
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
4
SIGNATURE PAGE
The undersigned have entered into this Stock Grant Agreement as of September 7,
2005.
BARRETTO PACIFIC CORPORATION
By: /s/ Xxxxxx Xxxxxxxx
-------------------
Xxxxxx Xxxxxxxx, President
91 - 1629148
Tax Identification Number
American Bio Medica Corp.
By: /s/ Xxxx Xxxxxxxxx
-------------------
Xxxx Xxxxxxxxx, Chief Executive Officer
By: /s/ Xxxxx X. Xxxxxx
-------------------
Xxxxx X. Xxxxxx, Chief Financial Officer
5
ATTACHMENT A
INDIVIDUAL ACCREDITED INVESTOR REPRESENTATION
I, Xxxxxx Xxxxxxxx, the undersigned, am an equity owner in Barretto Pacific
Corporation and am making this representation in connection with the issuance of
American Bio Medica Corporation common stock to Barretto Pacific Corporation. I
am an "Accredited Investor," as that term is defined in Rule 501(a) of
Regulation D under the Securities Act of 1933, as amended (the "Act"). This
representation is based on the following (initial one or more, as applicable):
_x_ (i) The undersigned is an individual with a net worth or a joint net worth
together with his or her spouse, in excess of $1,000,000. (In calculating worth,
you may include equity in personal property and real estate, including your
principal residence, cash, short-term investments, stock and securities. Equity
in personal property and real estate should be based on the fair market value of
such personal property and real estate should be based on the fair market value
of such property less any debt secured by such property.)
_x_ (ii) The undersigned is an individual that had an individual income in
excess of $200,000 in each of the prior two years and reasonably expects an
income in excess of $200,000 in the current year.
___ (iii) The undersigned is an individual that had with his or her spouse joint
income in excess of $300,000 in each of the prior two years and reasonably
expects joint income in excess of $300,000 in the current year
Dated: September 7, 2005
/s/ Xxxxxx Xxxxxxxx
-------------------
Xxxxxx Xxxxxxxx
6
