Exhibit 10.1
CLASS A COMMON STOCK PURCHASE
AGREEMENT
This Class A Common Stock
Purchase Agreement (this “Agreement”), dated as of
October 26, 2006, is by and between, SenseIt Corp. , a
Delaware corporation (the “Company”), and Isonics
Corporation , a California corporation (the
“Purchaser”). Capitalized terms used in this
Agreement and not otherwise defined shall have the meanings
ascribed to such terms in Article V of this Agreement.
W I T N E S S E T
H:
WHEREAS, prior to the Initial Closing Date, the Board of
Directors of the Company (the “Board of Directors”)
will create a class of securities to be known as Class A Common
Stock, with a par value of $0.001 per share (the “Class A
Common Stock”), the preferences, limitations and relative
rights of which are set forth in the form of the Certificate of
Amendment to the Certificate of Incorporation of the Corporation
attached as Exhibit 4.2(a) to this Agreement (the “Amended
Certificate of Incorporation”);
WHEREAS, subject to the conditions and terms set forth in
this Agreement, on the Initial Closing Date (at such term is
defined in Section 1.6 of this Agreement), the Company will issue
and sell to Purchaser and Purchaser will purchase from the Company
400,000 shares of Class A Common Stock (each, an “Initial
Share”), valued at $10.00 per Initial Share (the
“Initial Shares Purchase Price”), by assigning to the
Company all of Purchaser’s rights, title and interest under
the Development and Licensing Agreement, dated as of September 28,
2005 (the “Original Lucent Agreement”), as amended by
an Amendment effective July 31, 2006 (the “Amendment”)
and three additional amendments effective September 1, September
29, and October 16, 2006 (the “Additional Amendments”)
and, collectively with the Original Lucent Agreement and Amendment,
the “Lucent Agreement”), each between Purchaser and
Lucent Technologies Inc. (“Lucent”), including all
expenditures and commitments paid or incurred by Purchaser on or
prior to the Initial Closing Date in connection with the execution
and delivery of, and performance by Purchaser under, the Lucent
Agreement;
WHEREAS, subject to the conditions and terms set forth in
this Agreement, on the Initial Closing Date, the Company also will
issue and sell to Purchaser and Purchaser will purchase from the
Company an additional 25,000 shares of Class A Common Stock (each,
an “Additional Initial Share”), at a purchase price of
$10.00 per Additional Initial Share (the “Additional Initial
Shares Purchase Price”), for the aggregate consideration of
$250,000, payable in immediately available funds;
WHEREAS , the Company has agreed that, to the extent
that Lucent agrees to credit amounts greater than $1,000,000 of the
$1,333,000 payment contemplated by the first sentence of paragraph
3 of the Amendment towards amounts due Lucent under the Lucent
Agreement, whether credited prior to or after the Initial Closing
Date, it shall issue to Purchaser one additional share (each, a
“Credit Share”) of Class A Common Stock for every
$10.00 in excess of $1,000,000 so credited by Lucent (such amount
in excess of $1,000,000 being the “Credit
Amount”);
WHEREAS , subject to the conditions and terms set forth
in this Agreement, on the Second Installment Closing Date, the
Company will issue and sell to Purchaser and Purchaser will
purchase from the Company, 25,000 additional shares of Class A
Common Stock (each a “Second Installment Share”), at a
purchase price of $10.00 per Second Installment Share (the
“Second Installment Shares Purchase Price”), for the
aggregate consideration of $250,000, payable in immediately
available funds.
WHEREAS, subject to the conditions and terms set forth in
this Agreement, on the Lucent Payment Closing Date, the Company
will issue and sell to Purchaser and Purchaser will purchase from
the Company an additional aggregate 100,000 shares of Class A
Common Stock (each a “Lucent Payment Share”), at a
purchase price of $10.00 per Lucent Payment Share (the
“Lucent Payment Shares Purchase Price”), for the
aggregate consideration of $1,000,000, payable in immediately
available funds; and
WHEREAS, subject to the conditions and terms set forth in
this Agreement, on the Final Installment Closing Date, the Company
will issue and sell to Purchaser and Purchaser will purchase from
the Company, no later than March 14, 2007, additional shares of
Class A Common Stock (each a “Final Installment Share”)
in an amount equal to (a) 50,000 minus (b) the number of Credit
Shares issued prior to the Final Installment Closing Date, at a
purchase price of $10.00 per Final Installment Share (the
“Final Installment Shares Purchase Price”), for the
consideration equal to (X) $500,000 minus (4) the Credit
Amount, payable in immediately available funds.
NOW, THEREFORE,
in consideration of the premises and
agreements contained in this Agreement, and for good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, THE PARTIES HEREBY AGREE AS
FOLLOWS:
ARTICLE I
PURCHASE AND SALE OF THE CLASS A SECURITIES
Section
1.1.
Authorization of Issuance of Class A Common Stock.
Subject to the terms and
conditions of this Agreement, on or prior to the Initial Closing
Date, the Company shall have authorized the issuance and sale to
Purchaser of the Class A Securities.
Section
1.2.
Purchase and Sale of the Initial Shares. Subject to the terms and conditions of
this Agreement, Purchaser agrees to purchase, and the Company
agrees to issue and sell to Purchaser, at a closing (the
“Initial Closing”) held in accordance with Section 1.6,
the 400,000 Initial Shares in exchange for the assignment to the
Company by Purchaser of all of Purchaser’s rights, title and
interest under the Lucent Agreement, including all expenditures and
commitments paid or incurred by Purchaser on or prior to the
Initial Closing Date in connection with the execution and delivery
of, and performance by Purchaser under, the Lucent Agreement, such
assignment to be evidence by an Assignment, substantially in the
form attached as Exhibit 1.2 to this Agreement (the
“Assignment”). The consummation of the purchase
and sale of the Class A Initial
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Shares as contemplated by this
Section 1.2 are conditioned upon the simultaneous consummation of
the purchase and sale of the Additional Initial Shares as
contemplated by Section 1.3 of this Agreement.
Section
1.3.
Purchase and Sale of the Additional Initial Shares.
Subject to the terms and
conditions of this Agreement, the Purchaser agrees to purchase at
the Initial Closing, and the Company agrees to issue and sell to
Purchaser at the Initial Closing the 25,000 Additional Initial
Shares at a purchase price per Additional Initial Share equal to
the Class A Additional Initial Shares Purchase Price, for an
aggregate purchase price of $250,000, payable in immediately
available funds. The consummation of the purchase and sale of
the Additional Initial Shares as contemplated by this Section 1.3
are conditioned upon the simultaneous consummation of the purchase
and sale of the Initial Shares as contemplated by Section 1.2 of
this Agreement.
Section
1.4.
Purchase and Sale of the Second Installment Shares.
Subject to the terms and
conditions of this Agreement, Purchaser agrees to purchase, and the
Company agrees to issue and sell to Purchaser, at a closing (the
“Second Installment Closing”) to be held (a) on the
earlier of : (i) the third business day following the date on which
Purchaser shall have received a minimum of $250,000 in gross
proceeds from the sale of Purchaser’s securities pursuant to
that certain Securities Purchase Agreement, dated as of May 30,
2006, between Purchaser and Cornell Capital Partners, L.P., and
(ii) December 31, 2006 (in either case, the “Second
Installment Closing Date”) and (b) in accordance with Section
1.8, 25,000 Second Installment Shares at a purchase price per
Second Installment Share equal to the Second Installment Shares
Purchase Price, or for an aggregate purchase price of $250,000,
payable in immediately available funds. Purchaser’s
right to purchase from the Company, and the Company’s
obligation to sell and issue to Purchaser, such Second Installment
Shares shall be subject to Purchaser having duly purchased (x) the
Initial Shares pursuant to Section 1.2 and (y) the Additional
Initial Shares pursuant to Section 1.3.
Section
1.5.
Purchase and Sale of the Lucent Payment Shares.
Subject to the terms and
conditions of this Agreement, Purchaser agrees to purchase, and the
Company agrees to issue and sell to Purchaser, at a closing (the
“Lucent Payment Closing”), to be held in accordance
with Section 1.9, 100,000 of Lucent Payment Shares at a purchase
price per Lucent Payment Share equal to the Lucent Payment Shares
Purchase Price, or for an aggregate purchase price of $1,000,000
payable in immediately available funds. Purchaser’s
right to purchase from the Company, and the Company’s
obligation to sell and issue to Purchaser, such Lucent Payment
Shares shall be subject to Purchaser having duly purchased (x) the
Initial Shares pursuant to Section 1.2, (y) the Additional Initial
Shares pursuant to Section 1.3 (z) the Second Installment Shares
pursuant to Section 1.4.
Section
1.6.
Purchase and Sale of the Final Installment Shares.
Subject to the terms and
conditions of this Agreement, Purchaser agrees to purchase, and the
Company agrees to issue and sell to Purchaser, at a closing (the
“Final Installment Closing”) to be held (a) on March
14, 2007 (the “Final Installment Closing Date”) and (b)
in accordance with Section 1.10, 50,000 Final Installment Shares at
a purchase price per Final Installment Share equal to the Class A
Final Installment Shares Purchase Price, or for an aggregate
purchase price of $500,000, payable in immediately available
funds. Purchaser’s right to
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purchase from the Company, and the
Company’s obligation to sell and issue to Purchaser, such
Final Installment Shares shall be subject to Purchaser having duly
purchased (w) the Initial Shares pursuant to Section 1.2, (x) the
Additional Initial Shares pursuant to Section 1.3, (y) the Second
Intallment Shares pursuant to Section 1.4 and (z) the Lucent
Payment Shares pursuant to Section 1.5.
Section
1.7.
Initial Closing.
The Initial Closing of the purchase and sale of the Initial Shares
and Additional Initial Shares shall take place at 10:00 a.m. (local
time) at the offices of Davidoff, Malito & Hutcher LLP, located
at 200 Garden City Plaza - Suite 315, Garden City, New York 11530,
promptly upon the satisfaction or waiver of the closing conditions
set forth in Sections 4.1, 4.2 and 4.3, or on such other date and
at such other time as the Company and Purchaser mutually agree upon
in writing. The date on which the Initial Closing shall occur
is referred to herein as the “Initial Closing Date.” At
the Initial Closing, the Company shall deliver to Purchaser
certificates for the 400,000 Initial Shares and 25,000 Additional
Initial Shares against payment of the (a) Initial Shares Purchase
Price (by delivery of (i) a duly executed Assignment to the Company
and (ii) a consent to the Assignment duly executed by Lucent, which
consent shall include specific consent by Lucent to the assignment
of all indemnification rights granted to Isonics under the Lucent
Agreement and be in a form reasonably satisfactory to the Company
and Company’s counsel) and (b) aggregate Additional Initial
Shares Purchase Price, by wire transfer of immediately available
funds to such account as the Company designates. The Initial
Closing shall not occur, and the Company shall have no obligation
to make such deliveries, unless Purchaser purchases and pays for
all of the 400,000 Initial Shares and 25,000 Additional Initial
Shares. Purchaser shall pay any documentary stamp or similar
issue or transfer taxes due as a result of the issuance and sale of
the Initial Shares and Additional Initial Shares.
Section
1.8.
Second Installment Shares Closing. Subject to Section 1.4 and satisfaction
of the conditions set forth in Section 4.1 and paragraph 4.3, the
Second Installment Closing of the purchase and sale of the Second
Installment Shares shall take place at 10:00 a.m. (local time) at
the offices of Davidoff, Malito & Hutcher LLP, located at 200
Garden City Plaza - Suite 315, Garden City, New York 11530, on the
Second Installment Closing Date. At the Second Installment
Closing, the Company shall deliver to Purchaser a certificate for
the 25,000 Second Installment Shares to be sold at the Second
Installment Closing against payment of the aggregate Second
Installment Purchase Price, by wire transfer of immediately
available funds to such account as the Company designates.
The Second Installment Closing shall not occur, and the Company
shall have no obligation to make such delivery, unless Purchaser
purchases and pays for all of the 25,000 Second Installment
Shares. Purchaser shall pay any documentary stamp or similar
issue or transfer taxes due as a result of the issuance and sale of
the Second Installment Shares.
Section
1.9.
Lucent Payment Shares Closings. Subject to Section 1.5 and satisfaction
of the conditions set forth in Section 4.1 and paragraph 4.3, the
Lucent Payment Shares Closing of the purchase and sale of the
Lucent Payment Shares shall take place at 10:00 a.m. (local time)
at the offices of Davidoff, Malito & Hutcher LLP, located at
200 Garden City Plaza - Suite 315, Garden City, New York 11530, on
January 11, 2007 (the “Lucent Payment Shares Closing
Date”). At the Lucent Payment Shares
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Closing, the Company shall deliver
to Purchaser a certificate for the 100,000 Lucent Payment Shares
being purchased at the Lucent Payment Shares Closing against
payment of the aggregate Lucent Payment Shares Purchase Price, by
wire transfer of immediately available funds to such account as the
Company designates. The Lucent Payment Shares Closing shall
not occur, and the Company shall have no obligation to make such
delivery, unless Purchaser purchases and pays for all of the
100,000 Lucent Payment Shares. Purchaser shall pay any
documentary stamp or similar issue or transfer taxes due as a
result of any issuance and sale of Lucent Payment
Shares.
Section
1.10. Final Installment
Shares Closing.
Subject to Section 1.6 and satisfaction of the conditions set forth
in Section 4.1 and paragraph 4.3, the Final Installment Closing of
the purchase and sale of the Final Installment Shares shall take
place at 10:00 a.m. (local time) at the offices of Davidoff, Malito
& Hutcher LLP, located at 200 Garden City Plaza - Suite 315,
Garden City, New York 11530, on the Final Installment Closing
Date. At the Final Installment Closing, the Company shall
deliver to Purchaser a certificate for the 50,000 Final Installment
Shares to be sold at the Final Installment Closing against payment
of the aggregate Final Installment Purchase Price, by wire transfer
of immediately available funds to such account as the Company
designates. The Final Installment Closing shall not occur,
and the Company shall have no obligation to make such delivery,
unless Purchaser purchases and pays for all of the 50,000 Final
Installment Shares. Purchaser shall pay any documentary stamp
or similar issue or transfer taxes due as a result of the issuance
and sale of the Final Installment Shares.
Section
1.11 Issuance of
the Credit Shares .
Upon adequate evidence being presented to the Company that Lucent
has credited against amounts due Lucent under the Lucent Agreement
such funds as to create a Credit Amount, the Company shall
immediately issue to Purchaser such number of Credit Shares as
shall equal the quotient resulting from dividing (a) such Credit
Amount by (b) $10.00, and cause to be delivered to Purchaser as
soon as reasonably possible a certificate evidencing such Credit
Shares. The Credit Shares so issued shall be deemed issued as
of the date on which Lucent shall have credited the funds so as to
create such Credit Amount, regardless of the date of delivery of
the evidence of such credit.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and
warrants to Purchaser the following, except as set forth on the
Disclosure Schedule, which Disclosure Schedule shall be deemed to
be part of the representations and warranties as if made under this
Article II:
Section
2.1.
Organization and Qualification. The Company is duly organized, validly
existing and in good standing under the laws of Delaware and has
the requisite power and authority to own, lease and operate its
assets, properties and business and to carry on its business as it
is now being conducted or proposed to be conducted. The
Company is duly qualified as a foreign corporation to transact
business, and is in good standing, in each jurisdiction where it
owns or leases real property or maintains
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employees or where the nature of its
activities make such qualification necessary, except where such
failure to qualify would not have a Material Adverse
Effect.
Section
2.2.
Certificate of Incorporation and Bylaws. The Company has delivered to the
Purchasers true, correct, and complete copies of the
Company’s certificate of incorporation as in effect on the
date hereof (the “Existing Certificate”) and the
Company’s bylaws as in effect on the date hereof (the
“Existing Bylaws”).
Section
2.3.
Corporate Power and Authority. The Company has all requisite corporate
power and authority to execute and deliver this Agreement, issue
and sell the 300,000 Initial Shares, 25,000 Additional Initial
Shares, 25,000 Second Installment Shares, 200,000 Lucent Payment
Shares and 50,000 Final Installment Shares (collectively, the
“Class A Securities”) to Purchaser pursuant to this
Agreement (assuming the filing of the Amended Certificate of
Incorporation), and carry out and perform its obligations under the
terms of this Agreement.
Section
2.4.
Capitalization.
(a)
Immediately prior to the date of this Agreement, the authorized
capital stock of the Company consists of 100 shares all of which
are designated as common stock, par value $.001 per share, of which
100 shares are issued and outstanding and owned of record by
Christopher Toffales (“Toffales”).
(b)
Upon the filing of the Amended Certificate of Incorporation, the
authorized capital stock of the Company shall consist of 50,000,000
shares, each of a par value of $.001 per share, of which (i)
29,000,000 shares shall be designated as Common Stock, (ii)
20,000,000 shares shall be designated as Class A Common Stock,
(iii) 100 shares shall be designated as Class B Common Stock and
(iv) 999,900 shares shall be designated as Preferred Stock, of
which only 100 shares of Common Stock shall be issued and
outstanding and which shall be, at the Initial Closing, exchanged
for Class B Common Stock pursuant to the terms of the Stock
Exchange Agreement, dated of even date with this Agreement (the
“Stock Exchange Agreement”), between Toffales and the
Company, substantially in the form attached as Exhibit 4.2(b)(iii)
to this Agreement. As of the date of this Agreement, all
issued and outstanding shares of the Company’s capital stock
are duly authorized and validly issued, are fully paid and
non-assessable and are owned of record by Toffales. There are
no options, warrants, conversion privileges, or preemptive or other
rights or agreements presently outstanding to purchase or otherwise
acquire from the Company any shares of the capital stock or other
securities of the Company, except pursuant to the Stock Exchange
Agreement and this Agreement. The Company is not subject to
any obligation (contingent or otherwise) to repurchase or otherwise
to acquire or retire any shares of its capital stock, except as
provided in the Stock Exchange Agreement. The Company has
never declared or paid any dividend or made any other distribution
of cash, stock or other property to its stockholders. The
Company has no subsidiaries. No stock plan, stock purchase,
stock option or other agreement or understanding between the
Company and any holder of any equity securities or rights to
purchase equity securities provides for acceleration or other
changes in the vesting provisions or other terms of such agreement
or understanding
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(including any reduction in the
exercise price of any option, warrant or similar security) as the
result of any merger, consolidation or sale of stock.
Section
2.5.
Authorization. The
execution, delivery and performance by the Company of this
Agreement, and the sale, issuance and delivery of the Class A
Securities and the performance of all of the obligations of the
Company under this Agreement have been duly authorized by the Board
of Directors, and, other than (a) shareholder approval required
with respect to the Amended Certificate of Incorporation and (b)
the filing of the Amended Certificate of Incorporation with the
Secretary of State of the State of Delaware (the “Delaware
Secretary of State”), no other corporate action on the part
of the Company and no other corporate or other approval or
authorization is required on the part of the Company or otherwise
in order to make this Agreement and the sale and issuance of the
Securities the valid, binding and enforceable obligations (subject
to (i) laws of general application relating to bankruptcy,
insolvency, and the relief of debtors, and (ii) rules of law
governing specific performance, injunctive relief, or other
equitable remedies) of the Company.
Section
2.6.
Title to Properties and Assets. The Company does not currently own any
real property and has never owned any real property. The
Company has good and marketable title to or has, or will have,
concurrently with the execution of this Agreement, a valid
leasehold interest in, or license to use, all of the property or
assets used by it or located on its premises and necessary for the
conduct of business as presently conducted, free and clear of all
liens, other than as set forth on Section 2.6 of the Disclosure
Schedule (the “Permitted Liens”), which together do not
have a Material Adverse Effect.
Section
2.7.
Permits; Compliance with Applicable Law. The Company has all material franchises,
permits, licenses, authorizations, approvals, registrations and any
similar authority (“Permits”) necessary for the conduct
of its business as now being conducted by it and believes it can
obtain any similar authority for the conduct of its business as
currently planned by the Company to be conducted. The Company
is not in violation in any material respect of, or default in any
material respect under, any such Permits. All such Permits
are in full force and effect, and to the Company’s knowledge,
no violations in any material respect have been recorded in respect
of any such Permits; no proceeding is pending or, to the
Company’s knowledge, threatened to revoke or limit any such
Permit; and no such Permit will be suspended, cancelled or
adversely modified as a result of the execution and delivery of
this Agreement and the Class A Securities. The Company is in
compliance in all respects with all applicable laws, except where
the failure to so comply would not have a Material Adverse
Effect.
Section
2.8.
Absence of Conflicts. The Company is not in violation of or
default under any provision of its Existing Certificate or Existing
Bylaws. Except as set forth in Section 2.8 of the Disclosure
Schedule, the execution, delivery, and performance of, and
compliance with this Agreement and the consummation of the
transactions contemplated by this Agreement, have not and will
not:
(a)
violate, conflict with or result in a breach of any provision of or
constitute a default (or an event which, with notice or lapse of
time or both, would constitute a
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default) under, or result in the
termination of, or accelerate the performance required by, or
result in the creation of any Lien (other than a Permitted Lien)
upon any of the assets, properties or business of the Company
under, any of the terms, conditions or provisions of the Existing
Certificate, as amended by the Amended Certificate of
Incorporation, or the Existing Bylaws or any agreement to which the
Company is a party, or
(b)
violate any judgment, ruling, order, writ, injunction, award,
decree, or any Law or regulation of any court or federal, state,
county or local government or any other governmental, regulatory or
administrative agency or authority which is applicable to the
Company or any of its assets, properties or businesses, which
violation would have a Material Adverse Effect.
Section
2.9
Litigation. There
is no action, claim, litigation, tax or compliance audit, suit or
proceeding, regulatory or administrative enforcement action or
governmental inquiry or investigation (including, without
limitation, a defective pricing investigation or claim or other
proceeding in connection with the Company’s contracts),
pending, or, to the Company’s knowledge, any threat thereof,
against the Company or any of its officers or directors or the
assets of the Company. To the Company’s Knowledge,
there is no reason to believe that any of the foregoing may occur
which, in the aggregate, would have a Material Adverse
Effect. The Company is not subject to any outstanding
judgment, order or decree directed against the Company or any
officer or director of the Company. There is no action, suit,
proceeding or investigation into the possibility thereof by the
Company currently pending or that the Company presently intends to
initiate against a third party.
Section
2.10.
Consents. No
consent, approval, waiver or authorization, or designation,
declaration, notification, or filing with any person or entity
(governmental or private), on the part of the Company is required
in connection with the valid execution, delivery and performance of
this Agreement, the offer, sale or issuance of the Class A
Securities or the consummation of any other transaction
contemplated by this Agreement (other than such notifications or
filings required under applicable federal or state securities laws,
if any), except for such consents, approvals, waivers,
authorizations, designations, declarations, notifications, or
filings that will be received prior to or as of the Initial Closing
Date.
Section
2.11. Brokers or
Finders. The
Company has not incurred, or will not incur, directly or
indirectly, as a result of any action taken by the Company, any
liability for brokerage or finders’ fees or agents’
commissions or any similar charges in connection with this
Agreement or the issuance of the Class A Securities or any of the
transactions contemplated by this Agreement. The Company
agrees to indemnify and hold harmless Purchaser from any liability
for any commission or compensation in the nature of a
finder’s fee (and the costs and expenses of defending against
such liability or asserted liability) for which the Company or any
of its officers, employees or representatives is
responsible.
Section
2.12. Offering
Exemption.
Assuming the truth and accuracy of the representations and
warranties contained in Article III, the offer and sale of the
Class A Securities as contemplated by this Agreement and the
issuance and delivery to the
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