Exhibit 10.6
TERMINATION AGREEMENT
TERMINATION AGREEMENT dated the 1st day of March, 2004, and effective as of
October 1, 2003 (the "Agreement"), by and between Viral Genetics, Inc., a
Delaware corporation ("Viral Genetics"), and New York International Commerce
Group, Inc., a Nevada corporation ("NYIC").
WI T N E S S E T H:
WHEREAS, Viral Genetics and NYIC are parties to a Mutual Cooperation and Joint
Venture Agreement, dated March 25, 2002, as amended by the Amendment to the
Mutual Cooperation and Joint Venture Agreement made and entered into as of July
1, 2003 (jointly, the "Joint Venture Agreement"), pursuant to which Viral
Genetics and NYIC agreed to jointly exploit the Intellectual Property Rights and
Products in the Territory; and;
WHEREAS, subject to the terms and conditions herein, the Parties agree to
terminate the Joint Venture Agreement and the cooperative venture contemplated
therein.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth
and other good and valuable consideration, the receipt and legal adequacy of
which is hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Except for those terms expressly defined herein, capitalized
terms used herein shall have the same meanings herein as are given to such terms
under the Joint Venture Agreement.
2. Termination; Distribution of Assets. Upon the execution and delivery of this
Agreement, the Joint Venture Agreement and the cooperative venture contemplated
under the Joint Venture Agreement is hereby terminated and Viral Genetics and
NYIC shall not have any obligations or duties to the other under the Joint
Venture Agreement, except as expressly specified herein.
3. Exploitation in the Territory, Assistance of NYIC. NYIC irrevocably agrees
that Viral Genetics shall be free to exploit the Intellectual Property in the
Territory and to market, manufacture and sell Products in the Territory as Viral
Genetics determines appropriate. Notwithstanding the termination of the Joint
Venture Agreement as provided for herein, NYIC
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agrees that during the Term (as hereinafter defined) NYIC shall have its
directors and officers reasonably available to consult (in the form of providing
advice) with Viral Genetics about doing business in the PRC and elsewhere in the
Territory, upon the mutual convenience of the parties. It is agreed that the
directors and officers of NYIC shall not be required to spend any specific
amount of time providing the assistance to Viral Genetics as contemplated by
this Section 3. The directors and officers of NYIC shall not be required to
travel in connection with any such consulting session and Viral Genetics
acknowledges that the provision of any requested consulting services is subject
to the other commitments of the directors and officers of NYIC. Viral Genetics
shall pay for in advance any out-of-pocket costs and expenses that may be
incurred in providing any requested consulting services contemplated by this
Section 3.
4. Purchase of Assets. NYIC agrees to sell and Viral Genetics agrees to purchase
all of the assets of NYIC located in the People's Republic of China, as listed
in Schedule A (the "Assets"), for a purchase price of $1. The parties agrees to
execute, cause or give effect to such other agreements, title transfers,
assignments, or other documents or actions as are required in order to effect
said asset purchase. The parties shall act as promptly as reasonably possible.
The Parties agree that the cost of establishing clear title by NYIC to the
Assets would be prohibitive in relation to the estimated aggregate value of the
Assets and given their location in China. In lieu of this, NYIC represents in
good faith that NYIC has no knowledge of any circumstances that would preclude
the legal transfer of title or other valid form of ownership to Viral under this
Agreement, and to the best of its knowledge, the Assets represent physical goods
which exist as of the date hereof.. NYIC makes no representation as to the
physical condition of the Assets, and Viral accepts such Assets in "AS IS" and
"WHERE IS" condition. NYIC forgoes any and all claims to the Assets, whether
past, present or future.
5. Mr. Xxxxxxx Xxx. NYIC agrees that notwithstanding anything set forth in the
Joint Venture Agreement, following the execution and delivery of this Agreement,
Mr. Xxxxxxx Xxx ("Liu") shall resign as an officer of NYIC and Viral Genetics
shall be free to hire or otherwise retain the services of Liu. Concurrently with
the execution and delivery of this Agreement, Viral Genetics shall use its best
efforts to cause Liu to grant to NYIC, and NYIC shall grant to Liu a general
release relating to any matter arising out of Liu being an officer, director or
employee of NYIC or in any way relating to the transactions contemplated by the
Joint Venture Agreement from the beginning of time to the date of the release.
The release from Liu shall be in form, substance and scope that is reasonably
satisfactory to NYIC. Failure to obtain such release shall not affect the right
of Viral Genetics to employ Liu pursuant to this Section 5.
6. Consideration. In consideration of NYIC agreeing to terminate the Joint
Venture Agreement, the parties agree as follows:
(a) Royalty.
(i) Viral Genetics agrees that either it or any other present
or future entity through which they may engage in business, operations
or activities in the Territory, shall pay a royalty to NYIC equal to
five percent (5%) (the "Royalty") of all Gross Profits obtained by them
from the sale of Products in the Territory, for the period commencing
on the date of this Agreement and ending fifteen (15) years from and
including said date. There shall be no minimum Royalty payable to NYIC.
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(ii) The Royalty will be paid on a calendar quarterly basis,
no later than forty-five (45) days after the applicable quarter and
each payment shall be accompanied by a statement (the "Royalty
Statement"), which shall be certified as being accurate by Viral
Genetics' Chief Financial Officer, which shall set forth in reasonable
detail the calculation of Gross Profits for the quarter and the amount
of the Royalty payable to NYIC. The royalty shall be paid to NYIC in
U.S. Dollars.
(iii) NYIC shall have the right to dispute any Royalty
Statement that it objects to and to conduct an audit (using experts and
advisors chosen by NYIC) of Viral Genetics solely for purposes of
determining the amount of the Royalty payable to NYIC. NYIC shall bear
its own costs and expenses incurred with any such dispute or audit;
provided that if as a result thereof the amount of the Royalty payable
to NYIC is increased from that which was shown on the Royalty Statement
by more than $10,000, then Viral Genetics shall reimburse NYIC for such
costs and expenses. Said audit shall be conducted in a manner that does
not interfere with the ability of Viral Genetics to conduct its day to
day business, or otherwise materially impact Viral Genetics'
operations.
(iv) NYIC shall not have the right to dispute any Royalty
Statement, unless NYIC notifies Viral Genetics in writing within 180
days after NYIC's receipt of the applicable Royalty Statement that NYIC
disputes the Royalty Statement, and such notice shall describe in
reasonable detail the nature of the dispute.
(v) For purposes hereof, "Gross Profits" shall be defined as
in the Joint Venture Agreements. For purposes of determining Gross
Profits and the amount of the Royalty payable to NYIC, any amounts
which are included in any Gross Profits which are received by Viral
Genetics in a currency other than U.S. Dollars shall be converted to
U.S. Dollars as of the last day of the relevant quarter, regardless of
whether or not such amounts were actually so converted or repatriated
out of the Territory.
(b) Other Consideration. Within not less than five (5) business days of
the execution and delivery of this Agreement
(i) Viral Genetics shall deliver to NYIC certificates
representing o (o) fully-paid and non-assessable shares of the common
stock of Viral Genetics;
(ii) Viral Genetics shall deliver to NYIC options to purchase
shares of the common stock of Viral Genetics as follows and otherwise
in the form attached hereto as Exhibit A:
(1) an option to purchase o (o) shares of the common
stock of Viral Genetics at a price of $o per share,
exercisable until April 1, 2007;
(2) an option to purchase o (o) shares of the common
stock of Viral Genetics at a price of $o per share,
exercisable until April 1, 2007;
7. Release by Viral Genetics. As of the date of this Agreement and subject to
the terms and conditions herein, Viral Genetics for itself and on behalf of its
present and former officers, directors, employees, representatives, parent and
subsidiary entities, successors and assigns (the "Viral Genetics Releasors")
hereby forever releases NYIC, its shareholders, its present and former officers
and directors, employees, agents, affiliates, subsidiary or parent corporations,
representatives, insurers, attorneys, successors and assigns or anyone acting on
their behalf (the "NYIC Releasees"), from any and all claims, suits, debts,
liens, liabilities, losses, causes of
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action, rights, damages, demands, obligations, promises, costs and expenses
(including, without limitation, attorneys' fees and expenses) of every kind,
nature and description, in law or in equity, whether known or unknown, or known
in the future, fixed or contingent, billed or unbilled, suspected, disclosed or
undisclosed, claimed or concealed from the beginning of time through the date
hereof, which against the NYIC Releasees (or any of them) the Viral Genetics
Releasors (or any of them) ever had or now have in connection with, arising out
of, based upon or in any way related to the Joint Venture Agreement. The
releases in this Section 7 expressly exclude any claim that may arise under this
Agreement or after the date hereof.
8. Release by NYIC. As of the date of this Agreement and subject to the terms
and conditions herein, NYIC for itself and on behalf of its present and former
officers, directors, employees, representatives, parent and subsidiary entities,
successors and assigns (the "NYIC Releasors"), hereby forever releases Viral
Genetics and its shareholders, present and former officers and directors,
employees, agents, affiliates, subsidiary or parent corporations,
representatives, insurers, attorneys, advisors, successors and assigns or anyone
acting on their behalf (the "Viral Genetics Releasees") from any and all claims,
suits, debts, liens, liabilities, losses, causes of action, rights, damages,
demands, obligations, promises, costs and expenses (including, without
limitation, attorneys' fees and expenses) of every kind, nature and description,
in law or in equity, whether known or unknown, or known in the future, fixed or
contingent, billed or unbilled, suspected, disclosed or undisclosed, claimed or
concealed from the beginning of time through the date hereof, which against the
Viral Genetics Releasees (or any of them) the NYIC Releasors (or any of them)
ever had or now have, in connection with, arising out of, based upon or in any
way related to the Joint Venture Agreement. The releases in this Section 8
expressly exclude any claim that may arise under this Agreement on or after the
date hereof.
9. Representations and Warranties of Viral Genetics. Viral Genetics hereby
represents and warrants to NYIC that:
(a) Authority. Viral Genetics has full corporate right, power and
authority to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby. This Agreement
constitutes the legal, valid and binding obligation of Viral Genetics,
enforceable in accordance with its terms, subject to: (i) applicable
bankruptcy, insolvency, fraudulent conveyance and other similar laws
affecting the rights of creditors generally, (ii) general equitable
principles affecting the enforcement of obligations generally, whether
at law, in equity or otherwise, and (iii) the discretion of any court
before which any proceeding therefor may be brought. The execution,
delivery and performance by Viral Genetics of this Agreement and the
other documents contemplated hereby and the consummation of
transactions contemplated hereby have been duly authorized by the Board
of Directors of Viral Genetics.
(b) No Breach of Existing Agreements. The execution, delivery and
performance by Viral Genetics of this Agreement and the other
agreements and documents contemplated hereby and the consummation of
the transaction contemplated hereby does not and will not result (with
or without lapse of time or the giving of notice or both) in any breach
of, or conflict with, any of the terms or provisions of, or constitute
a default under, any agreement or instrument, or any judgment, decree
or order of any court, to which Viral Genetics is a party or by which
any of its assets may be bound. No consent
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or authorization of any person, firm, corporation or court is required
as a condition to Viral Genetics' execution, delivery or performance of
this Agreement.
10. Representations and Warranties of NYIC. NYIC hereby represents and warrants
to Viral Genetics that:
(a) Authority. NYIC has full corporate power and authority to execute,
deliver and perform this Agreement and to consummate the transactions
contemplated hereby. This Agreement constitutes the legal, valid and
binding obligation of NYIC enforceable in accordance with its terms,
subject to: (i) applicable bankruptcy, insolvency, fraudulent
conveyance and other similar laws affecting the rights of creditors
generally, (ii) general equitable principles affecting the enforcement
of obligations generally, whether at law, in equity or otherwise, and
(iii) the discretion of any court before which any proceeding therefor
may be brought. The execution, delivery and performance by NYIC of this
Agreement and the other documents contemplated hereby and the
consummation of the transactions contemplated hereby have been duly
authorized and approved by NYIC's Board of Directors.
(b) No Breach of Existing Agreements. The execution, delivery and
performance by NYIC of this Agreement and the other agreements and
documents contemplated hereby and the consummation of the transactions
contemplated hereby does not and will not result (with or without lapse
of time or the giving of notice or both) in any breach of, or conflict
with, any of the terms or provisions of, or constitute a default under,
any agreement or instrument, or any judgment, decree or order of any
court, to which NYIC is a party or by which any of its assets may be
bound. No consent or authorization of any person, firm, corporation or
court is required as a condition to NYIC's execution, delivery or
performance of this Agreement.
11. Condition Precedent.
(a) This Agreement shall be conditional upon the delivery of the
Termination Agreement with an effective date of October 1, 2003 between
Viral Genetics and L&M Global Ventures Inc.
12. Confidential Information.
(a) NYIC acknowledges that as a result of the Joint Venture Agreement,
it has been in a confidential relationship with Viral Genetics and has
had access to non-public confidential information and trade secrets of
Viral Genetics (collectively, "Viral Genetics Confidential
Information"). Viral Genetics Confidential Information includes, but is
not limited to, customer and client lists, financial information, price
lists, marketing and sales strategies and procedures, computer
programs, databases and software, supplier, vendor and service
information, intellectual property, strategies, test results, the
status of governmental approvals and business plans in respect of Viral
Genetics, including the terms, provisions and existence of this
Agreement. NYIC agrees to, at all times, maintain the strictest
confidentiality of all Viral Genetics Confidential Information and not
use or permit the use of, or disclose, discuss, reproduce, distribute,
communicate or transmit or permit the disclosure, discussion,
communication or transmission of, any Viral Genetics Confidential
Information. This Section 13(a) shall not apply to: (i) information
that was
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known by NYIC prior to the entering into of the Joint Venture
Agreement; (ii) information that, by means other than NYIC's
disclosure, becomes generally known to the public; (iii) information
that becomes available to NYIC on a nonconfidential basis from a source
other than Viral Genetics; provided, however, that such source is not
bound by a confidentiality agreement with or other obligation of
secrecy to Viral Genetics; (iv) information the disclosure of which is
compelled by applicable law, regulation or subpoena (including judicial
or administrative proceedings and legal process). In that connection,
in the event that NYIC is requested or required by applicable law,
regulation or subpoena to disclose any Viral Genetics Confidential
Information, NYIC agrees, to the extent practicable, to provide Viral
Genetics with prompt written notice of such request or requirement so
that Viral Genetics may seek an appropriate protective order or relief
therefrom or may waive the requirements of this Section 13(a). If,
failing the entry of a protective order or the receipt of a waiver
hereunder, NYIC is compelled to disclose Viral Genetics Confidential
Information under risk of liability for contempt or other censure or
penalty, NYIC may disclose such Viral Genetics Confidential
Information, but only to the extent so required.
(b) Viral Genetics acknowledges that as a result of the Joint Venture
Agreement, it has been in a confidential relationship with NYIC and has
had access to non-public confidential information and trade secrets of
NYIC, its subsidiaries and affiliates (collectively, the "NYIC
Confidential Information"). NYIC Confidential Information includes, but
is not limited to, customer and client lists, financial information,
price lists, marketing and sales strategies and procedures, computer
programs, databases and software, supplier, vendor and service
information, and business plans in respect of NYIC, including the
terms, provisions and existence of this Agreement. Viral Genetics
agrees to, at all times, maintain the strictest confidentiality of all
NYIC Confidential Information and not use or permit the use of, or
disclose, discuss, communicate or transmit or permit the disclosure,
discussion, communication or transmission of, any NYIC Confidential
Information. This Section 13(b) shall not apply to: (i) information
that was known by Viral Genetics prior to entering into the Joint
Venture Agreement; (ii) information that, by means other than
disclosure by Viral Genetics, becomes generally known to the public;
(iii) information that becomes available to Viral Genetics on a
nonconfidential basis from a source other than NYIC; provided, however,
that such source is not bound by a confidentiality agreement with or
other obligation of secrecy to NYIC; (iv) information, contacts,
strategies, relationships, or actions related to, or learned by, Viral
Genetics or Liu as a result of the contemplated joint venture described
in the Joint Venture Agreements, including, without limitation, the
specific knowledge, ability and strategy of Liu and his associates, and
any plan, idea, proposal, or strategy for obtaining any license and
effecting distribution of Viral Genetics products in Asia.; or (v)
information the disclosure of which is compelled by applicable law,
regulation or subpoena (including, without limitation, judicial or
administrative proceedings and legal process). In that connection, in
the event that Viral Genetics is requested or required by applicable
law, regulation or subpoena to disclose any NYIC Confidential
Information, Viral Genetics agrees , to the extent practicable, to
provide NYIC with prompt written notice of such request or requirement
so that NYIC may seek an appropriate protective order or relief
therefrom or may waive the requirements of this Section 13(b). If,
failing
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the entry of a protective order or the receipt of a waiver hereunder,
Viral Genetics is compelled to disclose NYIC Confidential Information
under risk of liability for contempt or other censure or penalty, it
may disclose such NYIC Confidential Information, but only to the extent
so required.
13. Non-Disturbance of Relationships. For so long as NYIC is receiving payment
of the Royalty hereunder, and for an additional ten (10) years following the
Term, if Viral Genetics has complied with all of its obligations hereunder, NYIC
shall not, directly or indirectly, in any capacity, whether as a stockholder,
lender, instructor, advisor or consultant, engage in any business or activity
anywhere in the world which is competitive with the business and activities of
Viral Genetics or any of its subsidiaries or affiliates.
14. Waiver of Notice. Each of NYIC and Viral Genetics hereby waive any notice
period which may be required in the Joint Venture Agreement or otherwise.
15. Remedies. In the event of a breach or threatened breach by NYIC of Viral
Genetics of any of the provisions of Sections 13 or 14 hereof, the parties
hereto shall be entitled to an injunction (both temporary and permanent) to be
issued by any court or tribunal of competent jurisdiction to restrain such other
party from committing or continuing any such violation, breach and other
equitable relief (in each case without being required to post a bond or other
security or to establish irreparable harm or to prove any actual damages). In
any proceeding for an injunction, the parties agree that their ability to obtain
damages shall not be a bar or be interposed as a defense to the granting of a
temporary or permanent injunction against them. Each of the parties acknowledges
that the other party will not have an adequate remedy at law in the event of any
breach as aforesaid and that such parties may suffer irreparable damage and
injury in the event of such a breach. Nothing contained herein shall be
construed as prohibiting the parties hereto from pursuing any other remedy or
remedies available to them in respect of such breach or threatened breach. In
addition, if any term or provision of Sections 13 or 14 shall be held invalid or
unenforceable because of its duration, geographic scope or for any other reason,
the court making such determination shall have the power to modify such
provision (whether by limiting the geographic scope, reducing the duration or
otherwise to the minimum extent necessary to make such term or provision valid
and enforceable), and such term or provision shall be enforceable in such
modified form.
16. Indemnification.
(a) Viral Genetics hereby indemnifies and defends NYIC and each of
NYIC's officers, directors, employees, shareholders, agents, advisors
or representatives (each, a "NYIC Indemnitee") against, and holds each
NYIC Indemnitee harmless from, any loss, liability, obligation,
deficiency, damage or expense including, without limitation, interest,
penalties, reasonable attorneys' fees and disbursements (collectively,
"Damages"), that any NYIC Indemnitee may suffer or incur based upon,
arising out of, relating to or in connection with (whether or not in
connection with any third party claim): (i) any breach of any
representation or warranty made by Viral Genetics contained in this
Agreement; (ii) the failure of Viral Genetics to perform or to comply
with any covenant or condition required to be performed or complied
with by Viral Genetics in accordance with this
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Agreement; (iii) third party claims relating to any of the Products;
and (iv) any of the business or activities that may be conducted,
directly or indirectly, by Viral Genetics in the Territory or
otherwise.
(b) NYIC hereby indemnifies and defends Viral Genetics and each of the
officers, directors, employees, shareholders, agents, advisors or
representatives of Viral Genetics (each, a "Viral Genetics Indemnitee")
against, and holds each Viral Genetics Indemnitee harmless from, any
Damages that such Viral Genetics Indemnitee may suffer or incur arising
from, related to or in connection with: (i) any breach of any
representation or warranty made by NYIC contained in this Agreement;
(ii) NYIC's failure to perform or to comply with any covenant or
condition required to be performed or complied with by NYIC in
accordance with this Agreement; (iii) the termination of the Joint
Venture Agreements and (iv) the issuance of shares and options pursuant
to the assignments contained in Section 6 (b)(iii) hereof.
(c) Indemnification Procedures for Third Party Claims.
(i) Promptly after notice to an indemnified party of any claim or the
commencement of any action or proceeding, including any actions or
proceedings by a third party (hereafter referred to as "Proceeding" or
"Proceedings"), involving any Damage referred to in this Section, such
indemnified party shall, if a claim for indemnification in respect
thereof is to be made against an indemnifying party pursuant to this
Section, give written notice to the indemnifying party, setting forth
in reasonable detail the nature thereof and the basis upon which such
party seeks indemnification hereunder; provided, however, that the
failure of any indemnified party to give such notice shall not relieve
the indemnifying party of its obligations hereunder, except to the
extent that the indemnifying party is actually prejudiced by the
failure to give such notice.
(ii) In the case of any Proceeding by a third party against an
indemnified party, the indemnifying party shall, upon notice as
provided above, assume the defense thereof, with counsel reasonably
satisfactory to the indemnified party, and, after notice from the
indemnifying party to the indemnified party of its assumption of the
defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred
by the indemnified party in connection with the defense thereof (but
the indemnified party shall have the right, but not the obligation, to
participate at its own cost and expense in such defense by counsel of
its own choice) or for any amounts paid or foregone by the indemnified
party as a result of any settlement or compromise thereof that is
effected by the indemnified party (without the written consent of the
indemnifying party).
(iii) Anything in this Section 15(c) notwithstanding, if both the
indemnifying party and the indemnified party are named as parties or
subject to such Proceeding and either party determines with advice of
counsel that there may be one or more legal defenses available to it
that are different from or additional to those available to the other
party or that a material conflict of interest between such parties may
exist in respect of such Proceeding, then the indemnifying party may
decline to assume the defense on behalf of the indemnified party or the
indemnified party may retain the defense on its own behalf, and, in
either such case, after notice to such effect is duly given hereunder
to the other party, the indemnifying party shall be relieved of its
obligation to assume the defense on behalf of the indemnified party,
but shall be required to pay any legal or other expenses
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including, without limitation, reasonable attorneys' fees and
disbursements, incurred by the indemnified party in such defense.
(iv) If the indemnifying party assumes the defense of any such
Proceeding, the indemnified party shall cooperate fully with the
indemnifying party and shall appear and give testimony, produce
documents and other tangible evidence, allow the indemnifying party
access to the books and records of the indemnified party (to the extent
they are applicable to the Joint Venture or this Agreement) and
otherwise assist the indemnifying party in conducting such defense. No
indemnifying party shall, without the consent of the indemnified party,
consent to entry of any judgment or enter into any settlement or
compromise which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a
release from all liability in respect of such claim or Proceeding.
Provided that proper notice is duly given, if the indemnifying party
shall fail promptly and diligently to assume the defense thereof, then
the indemnified party may respond to, contest and defend against such
Proceeding and may make in good faith any compromise or settlement with
respect thereto, and recover from the indemnifying party the entire
cost and expense thereof including, without limitation, reasonable
attorneys' fees and disbursements and all amounts paid or foregone as a
result of such Proceeding, or the settlement or compromise thereof. The
indemnification required hereunder shall be made by periodic payments
of the amount thereof during the course of the investigation or
defense, as and when bills or invoices are received or loss, liability,
obligation, damage or expense is actually suffered or incurred.
17. Publicity. Neither Viral Genetics or NYIC shall issue or make, or cause to
have issued or made, the publication or dissemination of any press release or
other public announcement or disclose any matter relating to the existence of
this Agreement, the other documents and the transactions contemplated hereby
without the prior written consent of the other, except as may be required
pursuant to applicable law, regulation or subpoena. Either party to this
Agreement shall have the right to publicize the existence of the Agreement but
not the material terms thereof, except that NYIC specifically consents to the
disclosure of the existence and material terms of this Agreement in the annual
Form 10-KSB filing of Viral with the United States Securities and Exchange
Commission for the year ended December 31, 2003. If either party intends to
publicize this Agreement (including, without limitation, the issuance of a press
release), then the prior written approval of the other party shall be required,
and such approval shall not be unreasonably withheld.
18. Further Assurances. From time to time prior to, at and after the execution
and delivery of this Agreement, Viral Genetics and NYIC shall execute and
deliver or cause to be executed and delivered such further documents and
instruments and take such further action as Viral Genetics or NYIC may
reasonable request in order to more effectively give effect to this Agreement.
19. Miscellaneous.
(a) Survival. The representations and warranties and other obligations
of the parties hereto shall survive the date hereof.
(b) Successors and Assigns; Assignment; Intended Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of Viral
Genetics and NYIC and their respective
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heirs, successors and permitted assigns. For purposes hereof,
successors of Viral Genetics and NYIC shall include, without
limitation, any corporation or corporations acquiring, directly or
indirectly, all or substantially all of the assets of Viral Genetics
and NYIC, respectively, whether by merger, consolidation, purchase,
lease or otherwise. No party shall assign this Agreement or delegate
any of their obligations hereunder without the prior written consent of
the other party. Notwithstanding the foregoing, NYIC may elect to
assign portions of the consideration payable pursuant to Section 3 to
various third parties ("NYIC Assignees"). Viral hereby provides its
consent to such assignment(s) provided that NYIC and each of the NYIC
Assignees shall execute an Assignment and Assumption Agreement in the
form attached hereto as Exhibit B. Further, in the event that any such
assignment includes assignment of shares and or options, each NYIC
Assignee shall provide to Viral a standard investor representation
letter in the form attached hereto as Exhibit C.
(c) Severability. The invalidity or unenforceability of any provision
of this Agreement, or part of any provision of this Agreement, shall
not affect the other provisions or parts hereof, and this Agreement
shall be construed in all respects as if such invalid or unenforceable
provisions or parties were omitted.
(d) Expenses. Each party shall pay its own expenses in connection with
this Agreement and the transactions contemplated hereby.
(e) Amendment; Entire Agreement. This Agreement may not be modified,
amended, altered or supplemented, except by a written agreement
executed by each of the parties hereto. This Agreement, including the
schedules and exhibits hereto, and the instruments and other documents
delivered pursuant to this Agreement contain the entire understanding
and agreement of the parties relating to the subject matter hereof and
supersedes all prior and/or contemporaneous understandings and
agreements of any kind and nature (whether written or oral) among the
parties with respect to such subject matter, all of which are merged
herein.
(f) Waiver. Any waiver by Viral Genetics, on the one hand, and NYIC, on
the other hand, of any breach of or failure to comply with any
provision or condition of this Agreement by the other party shall not
be construed as, or constitute, a continuing waiver of such provision
or condition, or a waiver of any other breach of, or failure to comply
with, any other provision or condition of this Agreement, any such
waiver to be limited to the specific matter and instance for which it
is given. No waiver of any such breach or failure or of any provision
or condition of this Agreement shall be effective unless in a written
instrument signed by the party granting the waiver. No failure or delay
by either party to enforce or exercise its rights hereunder shall be
deemed a waiver hereof, nor shall any single or partial exercise of any
such right or any abandonment or discontinuance of steps to enforce
such rights, preclude any other or further exercise thereof or the
exercise of any other right.
(g) Notices. All notices, demands, consents, requests, instructions and
other communications to be given or delivered or permitted under or by
reason of the provisions of this Agreement or in connection with the
transactions contemplated hereby shall be in writing and shall be
deemed to be delivered and received by the intended recipient as
follows: (a) if personally delivered, on the Business Day of such
delivery (as
10
evidenced by the receipt of the personal delivery service), (b) if
mailed certified or registered mail return receipt requested, four (4)
Business Days after being mailed, (c) if delivered by overnight courier
(with all charges having been prepaid), on the Business Day of such
delivery (as evidenced by the receipt of the overnight courier service
of recognized standing), or (d) if delivered by facsimile transmission,
on the Business Day of such delivery if sent by 5:00 p.m. in the time
zone of the recipient, or if sent after that time, on the next
succeeding Business Day (as evidenced by the printed confirmation of
delivery generated by the sending party's telecopier machine). If any
notice, demand, consent, request, instruction or other communication
cannot be delivered because of a changed address of which no notice was
given (in accordance with this Section 18), or the refusal to accept
same, the notice, demand, consent, request, instruction or other
communication shall be deemed received on the second Business Day the
notice is sent (as evidenced by a sworn affidavit of the sender). All
such notices, demands, consents, requests, instructions and other
communications will be sent to the following addresses or facsimile
numbers as applicable:
If to Viral Genetics:
Viral Genetics
000 Xxxxxxx Xxxxxx
Xxxxx Xxxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxxx
Facsimile No.: (000) 000-0000
If to NYIC:
New York International Commerce Group, Inc.
0 Xxxxx Xxxx
Xxxx Xxxxxxxxx, XX 00000
Attn: Xx. Xxxx Xxxxxx
Facsimile No.: (000) 000-0000
in each case with a copy to:
Jenkens & Xxxxxxxxx Xxxxxx Xxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxx Xxxxxxxx, Esq.
Telecopier: (000) 000-0000
or to such other address as any party may specify by notice given to
the other party in accordance with this Section 18(g).
(h) Governing Law; Jurisdiction. This Agreement shall be governed by
and construed in accordance with the laws of the State of California
applicable to agreements made and to be performed in that state,
without regard to any of its principles of conflicts of laws or other
laws which would result in the application of the laws of another
jurisdiction. This
11
Agreement shall be construed and interpreted without regard to any
presumption against the party causing this Agreement to be drafted.
Each of the parties unconditionally and irrevocably consents to the
exclusive jurisdiction of the Courts of the State of California and the
Federal District Court for the _____ District of California with
respect to any suit, action or proceeding arising out of or relating to
this Agreement or the Transactions contemplated hereby, and each of the
parties hereby unconditionally and irrevocably waives any objection to
venue in any such Court, and agrees that service of any summons,
complaint, notice or other process relating to such suit, action or
other proceeding may be effected in the manner provided in Section
18(g). Each of the parties hereby unconditionally and irrevocably
waives the right to a trial by jury in any action, suit or proceeding
arising out of or relating to this Agreement or the Transactions
contemplated hereby.
(i) Severability. The parties agree that should any provision of this
Agreement be held to be invalid, illegal or unenforceable in any
jurisdiction, that holding shall be effective only to the extent of
such invalidity, illegally or unenforceability without invalidating or
rendering illegal or unenforceable the remaining provisions hereof, and
any such invalidity, illegally or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any
other jurisdiction. It is the intent of the parties that this Agreement
be fully enforced to the fullest extent permitted by applicable law.
(j) Counterparts; Headings; etc. This Agreement may be executed in two
or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an
original, and all of which, when taken together, shall constitute one
and the same document. This Agreement shall become effective when one
or more counterparts, taken together, shall have been executed and
delivered by all of the parties. The section headings contained in this
Agreement (including, without limitation, section headings and headings
in the exhibits and schedules) are inserted for reference purposes only
and shall not affect in any way the meaning, construction or
interpretation of this Agreement. Any reference to the masculine,
feminine, or neuter gender shall be a reference to such other gender as
is appropriate. References to the singular shall include the plural and
vice versa.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
VIRAL GENETICS, INC.
By: ____________________________________
Name:
Title:
12
NEW YORK INTERNATIONAL
COMMERCE GROUP, INC.
By: ____________________________________
Name:
Title:
13
SCHEDULE A
Assets list of NYIC Rep. Office in Beijing
--------------------------------------------------------------------------------
Office Equipment Brand/Model Quantity
--------------------------------------------------------------------------------
Desktop Computer Acer 5
-------------------------------------
GUO HE 1
-------------------------------------
Philips 1
--------------------------------------------------------------------------------
Notebook Computer IBM 1
Fax Machine SUMSUNG SF-5100P 1
Copier RICOH FT-3813 1
Laser jet printer HP 1200 1
Stylus Printer Epson LQ 1600K 1
Color printer Epson 680 1
Scanner Epson 220 1
Shredder COMET C-22CC 1
Automatic Checkwriter Xxxxx 0
Xxxxxxxxx XXX Detector Baija WJB-BJYB-600 1
Cold & Hot Water Dispenser Midea 1
Water Purifier Qin Yuan QY98-1 1
Dust Collector SANYO 1
Switchboard SUMSUNG 2
Cordless Telephone SUMSUNG MH9049 1
Server Acer 1
Extension Telephone SIEMENS 11
Ethernet Card TENDA 1
Fast Ethernet Switch TENDA 1
--------------------------------------------------------------------------------
Office Furniture Quantity
--------------------------------------------------------------------------------
Wardrobe 1
Cabinet 4
Filing Cabinet 4
Lockers 16
Safe 2
Office Desk 11
Front Desk 1
-----------------------------------
Council Board 1 set including 8 chairs
--------------------------------------------------------------------------------
14
--------------------------------------------------------------------------------
Encoignure 1
Swivel Chair 11
Chinese-style Chair 4
Sofa 2
Tea Table 2
Newspaper Stand 1
Notice Board 1
--------------------------------------------------------------------------------
Other Quantity
--------------------------------------------------------------------------------
Automobile: black 1995 Mercedes Benz S500 1
--------------------------------------------------------------------------------
15
EXHIBIT A - Form of Option
VIRAL GENETICS, INC.
Option for the Purchase of _________
Shares of Common Stock
Par Value $0.001
STOCK OPTION AGREEMENT
THE HOLDER OF THIS OPTION, BY ACCEPTANCE HEREOF, BOTH WITH RESPECT TO THE OPTION
AND COMMON STOCK ISSUABLE UPON EXERCISE OF THE OPTION, AGREES AND ACKNOWLEDGES
THAT THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER
THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE TRANSFERRED OR SOLD IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT OR OTHER COMPLIANCE UNDER THE SECURITIES ACT OR THE LAWS
OF THE APPLICABLE STATE OR A "NO ACTION" OR INTERPRETIVE LETTER FROM THE
SECURITIES AND EXCHANGE COMMISSION OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE ISSUER, AND ITS COUNSEL, TO THE EFFECT THAT THE SALE OR
TRANSFER IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH STATE
STATUTES.
This is to certify that, for value received, [name] (the "Optionee") is
entitled to purchase from VIRAL GENETICS, INC. (the "Company" or "Corporation"),
on the terms and conditions hereinafter set forth, all or any part of
__________________ shares ("Option Shares") of the Company's common stock, par
value $0.001 (the "Common Stock"), at the purchase price of $[__] per share
("Option Price"). Upon exercise of this option in whole or in part, a
certificate for the Option Shares so purchased shall be issued and delivered to
the Optionee. If less than the total option is exercised, a new option of
similar tenor shall be issued for the unexercised portion of the options
represented by this Agreement.
This option is granted subject to the following further terms and
conditions:
1. This option shall vest and be exercisable immediately. The
right to exercise this option with respect to any of the
Option Shares shall terminate on April 1, 2007. In order to
exercise this option with respect to all or any part of the
Option Shares for which this option is at the time
exercisable, Optionee (or in the case of exercise after
Optionee's death, Optionee's executor, administrator, heir or
legatee, as the case may be) must take the following actions:
(a) Deliver to the Corporate Secretary of the Corporation an
executed notice of exercise in substantially the form of that
attached to this Agreement (the "Exercise Notice") in which
there is specified the number of Option Shares which are to be
purchased under the exercised option.
(b) Pay the aggregate Option Price for the purchased shares
through full payment in cash or by check made payable to the
Corporation's order;
A-1
(c) Furnish to the Corporation appropriate documentation that the
person or persons exercising the option (if other than
Optionee) have the right to exercise this option.
(d) For purposes of this Agreement, the Exercise Date shall be the
date on which the executed Exercise Notice shall have been
delivered to the Company. Payment of the Option Price for the
purchased shares must accompany such Exercise Notice.
(e) Upon such exercise, the Company shall issue and cause to be
delivered with all reasonable dispatch (and in any event
within five business days of such exercise) to or upon the
written order of the Optionee at its address, and in the name
of the Optionee, a certificate or certificates for the number
of full Option Shares issuable upon the exercise together with
such other property (including cash) and securities as may
then be deliverable upon such exercise. Such certificate or
certificates shall be deemed to have been issued and the
Optionee shall be deemed to have become a holder of record of
such Option Shares as of the Exercise Date.
2. The Optionee acknowledges that the shares subject to this option
have not and will not be registered as of the date of exercise of this option
under the Securities Act or the securities laws of any state. The Optionee
acknowledges that this option and the shares issuable on exercise of the option,
when and if issued, are and will be "restricted securities" as defined in Rule
144 promulgated by the Securities and Exchange Commission and must be held
indefinitely unless subsequently registered under the Securities Act and any
other applicable state registration requirements. The Company is under no
obligation to register the securities under the Securities Act or under
applicable state statutes. In the absence of a registration or an available
exemption from registration, sale of the Option Shares may be practicably
impossible.
3. The Company, during the term of this Agreement, will obtain from the
appropriate regulatory agencies any requisite authorization in order to issue
and sell such number of shares of its Common Stock as shall be sufficient to
satisfy the requirements of the Agreement.
4. The number of Option Shares purchasable upon the exercise of this
option and the Option Price per share shall be subject to adjustment from time
to time subject to the following terms. If the outstanding shares of Common
Stock of the Company are increased, decreased, changed into or exchanged for a
different number or kind of shares of the Company through reorganization,
recapitalization, reclassification, stock dividend, stock split or reverse stock
split, the Company or its successors and assigns shall make an appropriate and
proportionate adjustment in the number or kind of shares, and the per-share
Option Price thereof, which may be issued to the Optionee under this Agreement
upon exercise of the options granted under this Agreement. The purchase rights
represented by this option shall not be exercisable with respect to a fraction
of a share of Common Stock. Any fractional shares of Common Stock arising from
the dilution or other adjustment in the number of shares subject to this option
shall rounded-up to the nearest whole share.
5. The Company covenants and agrees that all Option Shares which may be
delivered upon the exercise of this option will, upon delivery, be free from all
taxes, liens, and charges with respect to the purchase thereof; provided, that
the Company shall have no obligation with respect to any income tax liability of
the Optionee and the Company may, in its discretion, withhold such amount or
require the Optionee to make such provision of funds or other consideration as
the Company deems necessary to satisfy any income tax withholding obligation
under federal or state law.
A-2
6. The Company agrees at all times to reserve or hold available a
sufficient number of shares of Common Stock to cover the number of Option Shares
issuable upon exercise.
7. This option shall not entitle the holder hereof to any voting rights
or other rights as a shareholder of the Company, or to any other rights
whatsoever, except the rights herein expressed, and no dividends shall be
payable or accrue in respect of this option or the interest represented hereby
or the Option Shares purchasable hereunder until or unless, and except to the
extent that, this option shall be exercised.
8. The Company may deem and treat the registered owner of this option
as the absolute owner hereof for all purposes and shall not be affected by any
notice to the contrary.
9. In the event that any provision of this Agreement is found to be
invalid or otherwise unenforceable under any applicable law, such invalidity or
unenforceability shall not be construed as rendering any other provisions
contained herein invalid or unenforceable, and all such other provisions shall
be given full force and effect to the same extent as though the invalid or
unenforceable provision were not contained herein.
10. This Agreement shall be governed by and construed in accordance
with the internal laws of the state of California, without regard to the
principles of conflicts of law thereof.
11. Except as otherwise provided herein, this Agreement shall be
binding on and inure to the benefit of the Company and the person to whom an
option is granted hereunder, and such person's heirs, executors, administrators,
legatees, personal representatives, assignees, and transferees.
IN WITNESS WHEREOF, the Company has caused this option to be executed
on the ___ day of __________, 200_, by the signature of its duly authorized
officer.
VIRAL GENETICS, INC.
By________________________________
Duly Authorized Officer
The undersigned Optionee hereby acknowledges receipt of a copy of the
foregoing option and acknowledges and agrees to the terms and conditions set
forth in the option.
Per:______________________________
A-3
Exercise Notice
(to be signed only upon exercise of Option)
TO: Viral Genetics, Inc.
The Optionee, holder of the attached option, hereby irrevocable elects
to exercise the purchase rights represented by the option for, and to purchase
thereunder, ________________________________ shares of common stock of Viral
Genetics, Inc., and herewith makes payment therefor, and requests that the
certificate(s) for such shares be delivered to the Optionee at:
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
If acquired without registration under the Securities Act of 1933, as
amended ("Securities Act"), the Optionee represents that the Common Stock is
being acquired without a view to, or for, resale in connection with any
distribution thereof without registration or other compliance under the
Securities Act and applicable state statutes, and that the Optionee has no
direct or indirect participation in any such undertaking or in the underwriting
of such an undertaking. The Optionee understands that the Common Stock has not
been registered, but is being acquired by reason of a specific exemption under
the Securities Act as well as under certain state statutes for transactions by
an issuer not involving any public offering and that any disposition of the
Common Stock may, under certain circumstances, be inconsistent with these
exemptions. The Optionee acknowledges that the Common Stock must be held and may
not be sold, transferred, or otherwise disposed of for value unless subsequently
registered under the Securities Act or an exemption from such registration is
available. The Company is under no obligation to register the Common Stock under
the Securities Act, except as provided in the Agreement for the option. The
certificates representing the Common Stock will bear a legend restricting
transfer, except in compliance with applicable federal and state securities
statutes.
The Optionee agrees and acknowledges that this purported exercise of
the option is conditioned on, and subject to, any compliance with requirements
of applicable federal and state securities laws deemed necessary by the Company.
DATED this ________ day of ________________________________, _________.
________________________________
Signature
A-4
Exhibit B
ASSIGNMENT
ASSIGNMENT dated as of March __, 2004 (this "Assignment"), from New
York International Commerce Group, Inc., a Nevada corporation (the "Assignor"),
to _____________ (the "Assignee").
WHEREAS, Assignor is a party to the Termination Agreement (the
"Agreement") dated the 1st day of March, 2004, and effective as of October 1,
2003 by and between Viral Genetics, Inc., a Delaware Corporation ("Viral
Genetics") and Assignor; and
WHEREAS, Section 6(b)(iii) of the Agreement contemplates that the
Assignor may assign to third parties a portion of the consideration provided for
in Section 6(a).
WHEREAS, therefore the Assignor is herewith assigning and transferring
to Assignee a portion of such consideration under the Agreement; and
WHEREAS, Assignee hereby accepts said assignment therein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
legal and adequacy of which is hereby acknowledged, the Assignor and the
Assignee agree as follow:
1. Without any further consideration, the Assignor hereby
assigns, transfers, disposes and sets over to the Assignee,
and Assignee hereby accepts, all of the Assignor's right,
title and interest to those shares of fully-paid and
non-assessable shares of Common Stock of Viral Genetics and
options to purchase shares of common stock of Viral Genetics
as more fully set forth on Schedule 1 attached hereto (the
"Assigned Interest").
2. The Assignor acknowledges and agrees that the Assignee is not
assuming, directly or indirectly, any of the obligation of the
Assignor under the Agreement.
3. At the request of the Assignee, the Assignor shall execute
such other instruments, documents and certificates of transfer
and assignment as the Assignee may reasonably request in order
to effectuate the terms and provisions of this Assignment
Agreement.
4. The Assignor represents and warrants to the Assignee that the
Assignor has not granted any lien in the Assigned Interest.
5. The terms and provisions of this Assignment Agreement may not
be modified, amended or waived, except by an agreement in
writing signed by each of the parties hereto.
6. This Assignment Agreement embodies and constitutes the entire
agreement and understanding of the parties hereto with respect
to the subject matter hereof. There are no promises,
representations, warranties, covenants or undertakings with
respect to such subject matter, other than those expressly set
forth or referred to herein. This Assignment Agreement
supersedes all prior and/or contemporaneous agreements and
understandings (whether written or oral), if any, between the
parties with respect to the subject matter hereof all of which
are merged herein.
7. This Assignment Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of New
York applicable to agreements made and
B-1
performed in the State of New York, without giving effect to
its principles of conflicts of law or choice of laws. This
Assignment Agreement shall be interpreted and construed
without regard to any rule which might require it to be
interpreted or construed with a presumption against the party
which caused this Assignment Agreement to be drafted.
8. The Assignor's rights and obligations hereunder are personal
to Assignor and shall not be assigned, without the prior
written consent of the Assignee. This Assignment Agreement
shall be binding upon and shall inure to the benefit of the
parties hereto and their successors and permitted assigns.
9. This Assignment Agreement may be executed in any number of
counterparts (including by facsimile signature); each of which
shall be deemed to be an original, and all of which, when
taken together, shall be deemed to be, and shall constitute,
one and the same agreement.
IN WITNESS WHEREOF, each of the parties have executed this Assignment
Agreement as of the date first above written.
New York International Commerce Group, Inc.,
as Assignor
By:________________________________________
Xxxx Xxxxxx, President
Acknowledged and Agreed:
_____________________________
, as Assignee
B-2
EXHIBIT C
INVESTMENT REPRESENTATIONS
Viral Genetics, Inc.
000 Xxxxxxx Xxxxxx
Xxxxx Xxxxxxxx, XX 00000
Re: Acquisition of Common Stock and or Options to Purchase Common Stock
Gentlemen:
In connection with the acquisition by the undersigned of the of common
stock and/or options to purchase common stock, including the common stock
underlying such options (collectively the "Securities") of Viral Genetics, Inc.,
in a private transaction from New York International Commerce Group, Inc., the
undersigned represents that the Securities are being acquired without a view to,
or for, resale in connection with any distribution of such Securities or any
interest therein without registration or other compliance under the Securities
Act of 1933, as amended (the "Securities Act"), and that the undersigned has no
direct or indirect participation in any such undertaking or in the underwriting
of such an undertaking.
The undersigned understands that the Securities have not been
registered, but are being acquired by reason of a specific exemption under the
Securities Act as well as under certain state statutes for transactions not
involving any public offering and transaction by a person other than an issuer,
underwriter, or dealer, and that any disposition of the subject Securities may,
under certain circumstances, be inconsistent with this exemption and may make
the undersigned an "underwriter" within the meaning of the Securities Act. It is
understood that the definition of an "underwriter" focuses on the concept of
"distribution" and that any subsequent disposition of the subject Securities can
only be effected in transactions that are not considered distributions.
Generally, the term "distribution" is considered synonymous with "public
offering" or any other offer or sale involving general solicitation or general
advertising. Under present law, in determining whether a distribution occurs
when securities are sold into the public market, under certain circumstances one
must consider the availability of public information regarding the issuer, a
holding period for the securities sufficient to assure that the persons desiring
to sell the securities without registration first bear the economic risk of
their investment, and a limitation on the number of securities which the
stockholder is permitted to sell and on the manner of sale, thereby reducing the
potential impact of the sale on the trading markets. These criteria are set
forth specifically in Rule 144 promulgated under the Securities Act. After one
year from the date the Securities are fully paid for and the subscription is
accepted by the issuer, all as calculated in accordance with Rule 144(d), sales
of the Securities in reliance on Rule 144 can only be made in limited amounts in
accordance with the terms and conditions of that rule. After two years from the
date the Securities are fully paid for, as calculated in accordance with Rule
144(d), they can generally be sold without meeting these conditions provided the
holder is not (and has not been for the preceding three months) an affiliate of
the issuer.
The undersigned acknowledges that the Securities must be held and may
not be sold, transferred, or otherwise disposed of for value unless they are
subsequently registered under the Securities Act or an exemption from such
registration is available. The issuer is under no obligation to register the
Securities under the Securities Act or under Section 12 of the Securities
Exchange Act of 1934, as amended, except as may be expressly agreed to by it in
writing. If Rule 144 is available, and no assurance is given that it will
C-1
be, initially only routine sales of such Securities in limited amounts can be
made in reliance on Rule 144 in accordance with the terms and conditions of that
rule. The issuer is under no obligation to the undersigned to make Rule 144
available, except as may be expressly agreed to by it in writing. In the event
Rule 144 is not available, compliance with Regulation A or some other disclosure
exemption may be required before the undersigned can sell, transfer, or
otherwise dispose of such Securities without registration under the Securities
Act. The issuer's registrar and transfer agent will maintain a stop transfer
order against the registration of transfer of the Securities, and the
certificates representing the Securities will bear a legend in substantially the
following form so restricting the sale of such Securities:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (the "Securities Act"),
AND ARE "RESTRICTED SECURITIES" WITHIN THE MEANING OF RULE 144
PROMULGATED UNDER THE SECURITIES ACT. THE SECURITIES HAVE BEEN ACQUIRED
FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION OR OTHER COMPLIANCE UNDER THE SECURITIES ACT.
The issuer may refuse to register transfer of the Securities in the
absence of registration under federal securities laws or compliance with Rule
144, unless the undersigned furnishes the issuer with a "no action" or
interpretative letter from the Securities and Exchange Commission or an opinion
of counsel reasonably acceptable to the issuer stating that the transfer is
proper. Further, unless such letter or opinion states that the Securities are
free of any restrictions under the Securities Act, the issuer may refuse to
transfer the Securities to any transferee who does not furnish in writing to the
issuer the same representations and agree to the same conditions with respect to
such Securities as set forth herein. The issuer may also refuse to transfer the
Securities if any circumstances are present reasonably indicating that the
transferee's representations are not accurate.
Dated: ___________________, 2004 _______________________________________
Signature
_______________________________________
Print Name
_______________________________________
Street
_______________________________________
City, State, and Zip Code
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