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CUSIP No.
452530 10 1
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13D
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Page 2 of
18
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|
1.
|
NAME
OF REPORTING PERSONS: Argyll Biotechnologies, LLC
|
|
2.
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
o
(b)
x*
|
|
3.
|
SEC
USE ONLY
|
|
4.
|
SOURCE
OF
FUNDS: N/A
|
|
5.
|
CHECK
IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO
ITEMS 2(d) OR 2(e)
o
|
|
6.
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
Delaware
|
|
NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY EACH
REPORTING
PERSON
WITH
|
7.
|
SOLE
VOTING POWER
0
|
|
8.
|
SHARED
VOTING POWER
145,363,798**
|
|
9.
|
SOLE
DISPOSITIVE POWER
0
|
|
10.
|
SHARED
DISPOSITIVE POWER
145,363,798**
|
|
11.
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
145,363,798**
|
|
12.
|
CHECK
IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
|
|
13.
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.44%
|
|
14.
|
TYPE
OF REPORTING PERSON
OO
|
* See
Item 2 hereof.
**See
Item 5 hereof.
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CUSIP No.
452530 10 1
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13D
|
Page 3 of
18
|
|
1.
|
NAME
OF REPORTING PERSONS: James T. Miceli
|
|
2.
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
o
(b)
x*
|
|
3.
|
SEC
USE ONLY
|
|
4.
|
SOURCE
OF
FUNDS: N/A
|
|
5.
|
CHECK
IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO
ITEMS 2(d) OR 2(e)
o
|
|
6.
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
United
States
|
|
NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY EACH
REPORTING
PERSON
WITH
|
7.
|
SOLE
VOTING POWER
0
|
|
8.
|
SHARED
VOTING POWER
145,363,798**
|
|
9.
|
SOLE
DISPOSITIVE POWER
0
|
|
10.
|
SHARED
DISPOSITIVE POWER
145,363,798**
|
|
11.
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
145,363,798**
|
|
12.
|
CHECK
IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
o
|
|
13.
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.44%
|
|
14.
|
TYPE
OF REPORTING PERSON
IN
|
* See
Item 2 hereof.
**See
Item 5 hereof.
|
CUSIP No.
452530 10 1
|
13D
|
Page 4 of
18
|
|
1.
|
NAME
OF REPORTING PERSONS: Douglas A. McClain, Jr.
|
|
2.
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
o
(b)
x*
|
|
3.
|
SEC
USE ONLY
|
|
4.
|
SOURCE
OF
FUNDS: N/A
|
|
5.
|
CHECK
IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO
ITEMS 2(d) OR 2(e)
o
|
|
6.
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
United
States
|
|
NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY EACH
REPORTING
PERSON
WITH
|
7.
|
SOLE
VOTING POWER
0
|
|
8.
|
SHARED
VOTING POWER
145,363,798**
|
|
9.
|
SOLE
DISPOSITIVE POWER
0
|
|
10.
|
SHARED
DISPOSITIVE POWER
145,363,798**
|
|
11.
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
145,363,798**
|
|
12.
|
CHECK
IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
o
|
|
13.
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.44%
|
|
14.
|
TYPE
OF REPORTING PERSON
IN
|
* See
Item 2 hereof.
**See
Item 5 hereof.
|
CUSIP No.
452530 10 1
|
13D
|
Page 5 of
18
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ITEM
1. SECURITY AND ISSUER
This
Schedule 13D (this “
Schedule 13D
”)
relates to the common stock, par value $0.0001 per share (the “
Common Stock
”), of
Immunosyn Corporation, a Delaware corporation (the “
Issuer
”). The
principal executive office of the Issuer is located at 4225 Executive Square,
Suite 260, La Jolla, California 92037.
ITEM 2. IDENTITY AND
BACKGROUND
This
Schedule 13D is filed by Argyll Biotechnologies, LLC, a Delaware limited
liability company (“
Argyll
”), and the
other persons named on Exhibit A to the original filing hereof (each a “
Reporting Person
” and
together the “
Reporting Persons
”)
filed with the Securities and Exchange Commission on February 16, 2007 (the
"Initial Filing"). Exhibit A to the Initial Filing also sets forth
the name, place of organization, principal business, address of principal
business, address of principal office and other information with respect to the
Reporting Persons.
Argyll is
the owner of 145,363,798 shares of Common Stock of the Issuer. Argyll
is jointly controlled by its members, James T. Miceli and Douglas A. McClain,
Jr. There is no agreement or arrangement among the two members of Argyll with
respect to the voting or disposition of any securities of the Issuer owned by
Argyll or any of the other Reporting Persons other than as described in Item 6
of this Schedule 13D.
ITEM
3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Argyll
disposed of 400,000 shares of Common Stock of the Issuer for $2,000,000, or
$5.00 per share, on March 13, 2008 in a privately negotiated
transaction.
Argyll disposed of an aggregate of 16,000 shares of Common Stock of the
Issuer for $80,000, or $5.00 per share, on October 24, 2007 in two privately
negotiated transactions. In addition, on or about October 24, 2007, Argyll
made an individual gift of 10,000 shares to a personal acquaintance of the
beneficial owners for no consideration. Argyll disposed of 5,333 shares of
Common Stock of the Issuer for $39,997.50, or $7.50 per share, on November 1,
2007 in a privately negotiated transaction.
ITEM
4. PURPOSE OF TRANSACTION
On March
13, 2008, Argyll sold 400,000 shares of Common Stock for $2,000,000, or $5.00
per share, in a privately negotiated transaction.
Argyll disposed of
an aggregate of 16,000 shares of Common Stock of the Issuer for $80,000, or
$5.00 per share, on October 24, 2007 in two privately negotiated
transactions. In addition, on or about October 24, 2007, Argyll made an
individual gift of 10,000 shares to a personal acquaintance of the beneficial
owners for no consideration. Argyll disposed of 5,333 shares of Common
Stock of the Issuer for $39,997.50, or $7.50 per share, on November 1, 2007 in a
privately negotiated transaction.
Argyll continues to own
145,363,798 shares of Common Stock of the Issuer.
Although
no Reporting Person has formulated any definitive plans not heretofore disclosed
or set forth herein, each may from time to time acquire Common Stock of the
Issuer or dispose of Common Stock of the Issuer through open-market or privately
negotiated transactions or otherwise if and when each deems it
appropriate. Each Reporting Person may formulate other purposes,
plans or proposals relating to any of such securities of the Issuer to the
extent deemed advisable in light of market conditions, investment policies and
other factors.
Except as
set forth in this Schedule 13D, the Reporting Persons do not presently have any
specific plans or proposals that relate to or would result in any of the actions
described in subparagraphs (a) through (j) of Item 4 of this Schedule
13D.
|
CUSIP No.
452530 10 1
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13D
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Page 6 of
18
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ITEM
5. INTEREST IN SECURITIES OF THE ISSUER
The
Reporting Persons’ beneficial ownership is as follows:
|
|
(a)
|
Amount
beneficially owned: 145,363,798 shares of Common
Stock
|
|
|
|
Percent
of class: 53.44% based on 272,000,000 shares of Common Stock
issued and outstanding.
|
|
|
(b)
|
Number
of shares as to which the Reporting Persons
have:
|
|
|
(i)
|
Sole
power to vote or to direct the vote
- 0
|
|
|
(ii)
|
Shared
power to vote or to direct the vote -
145,363,798
|
|
|
(iii)
|
Sole
power to dispose or to direct the disposition of –
0
|
|
|
(iv)
|
Shared
power to dispose or to direct the disposition of -
145,363,798
|
|
|
(c)
|
The
information with respect to the acquisition of the Common Stock of the
Issuer by Argyll, as set forth in Items 3 and 4, is hereby incorporated by
reference.
|
ITEM
6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Pursuant
to a Stock Purchase and Option Agreement dated March 13, 2008 (the “Closing
Date”) between Argyll Biotechnologies, LLC (“Argyll”) and Myron W. Wentz, Ph.D.,
Dr. Wentz purchased, for $2,000,000, 400,000 shares of the Issuer’s Common
Stock, subject to adjustment. If the closing price of the Issuer’s
Common Stock on the principal exchange on which it is traded does not equal or
exceed US$5.00 per share on the one year anniversary of the Closing Date (or the
next business day if the one year anniversary of the Closing Date does not fall
on a business day), Argyll shall deliver to Dr. Wentz a certificate or
certificates evidencing such additional number of shares of Common Stock (the
“Make Whole Shares”) determined by dividing $2,000,000 by the closing price of
the Issuer’s Common Stock on the principal exchange on which it is traded on the
one year anniversary of the Closing Date and subtracting from such amount
400,000 (the number of Shares purchased on the Closing Date).
In
addition, Argyll granted to Dr. Wentz an option to purchase up to 800,000 shares
of the Issuer’s Common Stock from it for an exercise price of $6.00 per share on
or before March 13, 2011. Also, Argyll granted Dr. Wentz four annual
options to purchase 100,000 shares of the Issuer’s Common Stock each for
exercise prices of $2.50, $3.50, $4.50 and $5.50 per share, effective as of the
Closing Date, the first anniversary of the Closing Date, the second anniversary
of the Closing Date and the third anniversary of the Closing Date, respectively,
expiring on the tenth anniversary of the date of grant.
Also,
Argyll agreed to nominate and/or cause Dr. Wentz (or his designee) to be elected
to the Issuer’s Board of Directors at each annual meeting of stockholders for so
long as Dr. Wentz owns at least 200,000 shares of the Issuer’s Common Stock and
Argyll agreed to vote all, or
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CUSIP No.
452530 10 1
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13D
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Page 7 of
18
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cause (to
the extent within its control) to be voted all, shares of the Issuer’s Common
Stock owned or controlled by Argyll, directly or indirectly, to be voted to
elect Dr. Wentz or his designee to serve on the Issuer’s Board of Directors for
so long as Dr. Wentz owns at least 200,000 shares of the Issuer’s Common
Stock. Dr. Wentz agreed to serve on the Issuer’s Board of Directors
if elected.
ITEM
7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit A
– Stock Purchase and Option Agreement between Argyll Biotechnologies, LLC and
Myron W. Wentz, Ph.D. dated March 13, 2008.
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CUSIP No.
452530 10 1
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13D
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Page 8 of
18
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SIGNATURE
After
reasonable inquiry and to the best of his or its knowledge and belief, each of
the undersigned certifies that the information set forth in this Schedule 13D is
true, complete and correct.
ARGYLL
BIOTECHNOLOGIES, LLC
By:
/s/ Douglas A. McClain,
Jr.
Name:
Douglas A. McClain, Jr.
Title:
Chief Financial Officer
/s/ James T.
Miceli
James T.
Miceli
/s/ Douglas A. McClain,
Jr.
Douglas
A. McClain, Jr.
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CUSIP No.
452530 10 1
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13D
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Page 9 of
18
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EXHIBIT
A
STOCK
PURCHASE AND OPTION AGREEMENT
THIS STOCK PURCHASE AND OPTION
AGREEMENT
(this “
Agreement
”)
is made and entered into this 13
th
day of
March, 2008 by and between Argyll Biotechnologies LLC, a Delaware limited
liability company domiciled in California with its principal executive offices
located at 4225 Executive Square, Suite 260, La Jolla, California 92037 (the
“
Stockholder
”),
and Myron W. Wentz, Ph.D., an individual resident of Mexico with a business
address at
Sanoviv
Medical Institute, Playas de Rosarito, Km 39, Baja California, Mexico
22712
(the “
Purchaser
”).
WHEREAS,
the Stockholder is the record and beneficial owner of 145,763,798 shares of
common, par value $.0001 per share (the “
Common
Stock
”), issued by Immunosyn Corporation, a Delaware corporation
domiciled in California (the “
Company
”),
representing approximately 53.589% of the Company’s issued and outstanding
shares of Common Stock; and
WHEREAS,
on the terms and subject to the conditions set forth herein, the Purchaser
desires to acquire from the Stockholder, and the Stockholder desires to sell to
the Purchaser, certain of its shares of Company Common Stock owned by the
Stockholder.
NOW,
THEREFORE, the parties hereto, intending to be legally bound hereby, agree as
follows:
ARTICLE
I
Purchase
and Sale of the Shares
1.1
Purchase and Sale of the
Shares.
On the Closing (defined below), the Stockholder shall
sell and transfer to the Purchaser and the Purchaser shall purchase and acquire
from the Stockholder, 400,000 shares of the Company’s Common Stock (the “
Shares
”)
in exchange for the Purchase Price (defined below).
ARTICLE
II
Purchase
Price
2.1
Purchase Price.
In
consideration for the Shares, the Purchaser shall deliver to the Stockholder the
aggregate sum of US$2,000,000 (or US$5.00 per share) via wire transfer of
immediately available funds (the “
Purchase
Price
”) at the closing (the “
Closing
”)
to be held on the date hereof (the “
Closing
Date
”).
2.2
Delivery of the
Shares.
At the Closing, the Stockholder shall deliver to the
Purchaser a certificate or certificates evidencing the Shares registered in the
Purchaser’s name or in the name of such affiliate designee as shall be
identified by the Purchaser.
2.3
Adjustment of the
Shares.
If the closing price of the Common Stock of the
Company on the principal exchange on which it is traded does not equal or exceed
US$5.00 per share on the one year anniversary of the Closing Date (or the next
business day if the one year anniversary of the Closing Date does not fall on a
business day), the Stockholder shall deliver to the Purchaser within five (5)
business days thereafter a certificate or certificates evidencing such
additional number of shares of Common Stock (the “
Make
Whole Shares
”) determined by
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CUSIP No.
452530 10 1
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13D
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Page 10 of
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dividing
$2,000,000 by the closing price of the Common Stock of the Company on the
principal exchange on which it is traded on the one year anniversary of the
Closing Date and subtracting from such amount 400,000 (the number of Shares
purchased on the Closing Date hereunder), such Make Whole Shares to be
registered in the Purchaser’s name.
ARTICLE
III
Conditions
On Performance
3.1
Conditions to the Purchaser’s
Obligations.
The obligation of the Purchaser to consummate the
transactions contemplated by this Agreement is subject to the satisfaction of
the following conditions as of the Closing Date:
(a) the
representations and warranties set forth in Article IV of this Agreement shall
be true and correct in all material respects as of the Closing Date;
and
(b) the
purchase of the Shares by the Purchaser hereunder shall not be prohibited by any
applicable law or governmental regulation, and shall not subject the Purchaser
to any penalty or liability under or pursuant to any applicable law or
governmental regulation.
Any
condition may be waived by the Purchaser, provided that no such waiver shall be
effective against the Purchaser unless it is set forth in a writing executed by
the Purchaser.
3.2
Conditions to the Stockholder’s
Obligation.
The obligation of the Stockholder to consummate
the transaction contemplated by this Agreement is subject to satisfaction of the
following conditions as of the Closing Date:
(a) the
representations and warranties set forth in Article V of this Agreement shall be
true and correct in all material respects as of the Closing Date;
(b) the
sale of the Shares by the Stockholder hereunder shall not be prohibited by any
applicable law or governmental regulation, and shall not subject the Stockholder
to any penalty, liability or other materially adverse condition under or
pursuant to any applicable law or governmental regulation; and
(c) no
action, suit, or proceeding shall be pending before any court or quasi-judicial
or administrative agency of any federal, state, or local jurisdiction or before
any arbitrator wherein an unfavorable judgment, decree, injunction, order or
ruling would prevent the performance of this Agreement or any of the
transactions contemplated hereby, declare unlawful the transactions contemplated
by this Agreement, cause such transactions to be rescinded or materially and
adversely affect the right of the Stockholder to sell the Shares, and no
judgment, decree, injunction, order or ruling shall have been entered which has
any of the foregoing effects.
Any
condition may be waived by the Stockholder, provided that no such waiver shall
be effective against the Stockholder unless it is set forth in a writing
executed by the Stockholder.
ARTICLE
IV
Representations
and Warranties of the Stockholder
The Stockholder makes the following
representations and warranties, which representations and warranties shall
survive the Closing.
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13D
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Page 11 of
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4.1
Execution and
Delivery.
The Stockholder has duly executed and delivered this
Agreement. This Agreement is valid and binding upon the Stockholder,
enforceable against the Stockholder in accordance with it terms. The
Stockholder represents that it has full power and authority to enter into this
Agreement and perform its obligations hereunder. The Stockholder has the ability
to sell the Shares and perform the Stockholder’s obligations under this
Agreement.
4.2
Title to
Shares.
The Stockholder is the record and beneficial owner of,
and has full right, title and interest in and to, the Shares, free and clear of
any lien, charge or encumbrance. Except for a Sales Plan pursuant to
Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, the Shares
are not subject to any voting trust agreement or other contract, agreement,
arrangement, commitment or understanding, including any such agreement,
arrangement, commitment or understanding restricting or otherwise relating to
the voting, dividend rights or disposition of the Shares. At the
Closing, the Stockholder will transfer and deliver to the Purchaser valid title
to, and all of the Stockholder’s right, title and interest in and to, the
Shares, free and clear of any lien, charge or other encumbrance or any claim in
respect of the Shares.
4.3
Absence of
Litigation.
There is no action, suit or proceeding pending or,
to the Stockholder’s knowledge, threatened against or affecting the Stockholder
or the Stockholder’s property before any court, arbitrator or governmental body,
agency or official which in any manner involves the Shares owned by the
Stockholder or draws into question the validity of this Agreement or the
Shares.
4.4
Rule 144
. The
Stockholder is selling the Shares to the Purchaser in compliance with Rule 144
under the federal securities laws.
As a result, such Shares
will be fully transferable and tradeable in the hands of the
Purchaser.
4.5
Indemnification
. The
Stockholder agrees to indemnify and hold harmless the Purchaser and/or his
permitted assigns, from and against any and all damages, losses, liability,
claims, costs and expenses whatsoever (including reasonable attorneys’ fees)
which the Purchaser may incur by reason of the failure of the Stockholder to
fulfill any of the terms or conditions of this Agreement, or by reason of any
breach of the representations and warranties or covenants made by the
Stockholder herein or in any document provided by the Stockholder to the
Purchaser in connection with the transaction contemplated hereby.
4.6
Survival.
The
representations and warranties of the Stockholder set forth in this Agreement
shall survive the execution of this Agreement and the transactions contemplated
thereby.
ARTICLE
V
Representations
and Warranties of the Purchaser
The
Purchaser makes the following representations and warranties, which
representations and warranties shall survive the Closing.
5.1
Binding
Obligation.
This Agreement has been duly executed and
delivered by the Purchaser and is a valid and binding obligation of the
Purchaser, enforceable against the Purchaser in accordance with its
terms. The Purchaser represents that he has full power and authority
to enter into this Agreement and perform his obligations hereunder.
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13D
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5.2
Public
Information.
The Purchaser acknowledges receipt and review of
the Company’s Annual Report on Form 10-KSB for the fiscal year ended December
31, 2006 and the Company’s Quarterly Reports on Form 10-QSB for the fiscal
quarters ended March 31, 2006, June 30, 2006 and September 30, 2006 together
with certain Current Reports on Form 8-K all filed with the SEC, prior to the
Purchaser entering into this Agreement. The Purchaser acknowledges
that, to the extent it receives conflicting information concerning the Company,
the information in the public filings referred to above shall
govern. The Purchaser acknowledges receipt and review of the
Prospectus, dated January 4, 2007, concerning the registration with the United
States Securities and Exchange Commission (Registration no. 333-137881) for the
sale of the Shares which is not current but is in the process of being updated
to include current financial and other information.
5.3
Disclosure of
Information.
The Purchaser has had an opportunity to discuss
the Company's business, management and financial affairs with the Company's
management and the Stockholder. The Purchaser has also had an
opportunity to ask questions of officers of the Company and the Stockholder,
which questions were answered to the Purchaser’s satisfaction. The
Purchaser understands that such discussions, as well as any written information
issued by the Company, were intended to describe certain aspects of the
Company's business and prospects but were not an exhaustive
description. The Purchaser has undertaken and completed its review
and examination of the books and records of the Company and conducted its own
due diligence and investigation in connection with its proposed purchase of the
Shares. The Purchaser acknowledges that Regulation FD, as promulgated
by the Securities and Exchange Commission under the Securities Act of 1933, as
amended, and the Securities Exchange Act of 1934, as amended, is applicable to
any material, non-public information provided or disclosed to the Purchaser in
connection with this transaction. Accordingly, the Purchaser agrees
to hold any such information in the strictest confidence and agrees not to
disclose or use, or permit others to disclose or use, such information until
such information has been disclosed by the Company to the public. The
Purchaser further agrees that it will not resell or otherwise transfer any of
the Shares until such information has been disclosed by the Company to the
public.
5.4
Investment Experience; Accredited
Investor.
The Purchaser is an “accredited investor” as defined
in Rule 501 of Regulation D under the Securities Act of 1933, as amended, and
the Purchaser has the knowledge, sophistication and experience necessary in
financial, tax, and business matters so as to enable the Purchaser to utilize
the information made available to the Purchaser by the Stockholder and the
Company to evaluate the merits and risks of this investment in the Shares and to
make an informed investment decision. The Purchaser is not relying on
the Stockholder, the Company, any of their respective executives, or any of
their counsel, agents, or employees or any other person or entity with respect
to the legal, tax, and other economic considerations of the Purchaser in making
this investment in the Shares, other than the Purchaser’s own
advisors. Prior to signing this Agreement, the Purchaser made such
investigation of the Company, its business, the Shares, and the risks of this
investment in the Shares as the Purchaser deemed appropriate and consulted with
such legal, tax, and other advisors as the Purchaser deemed appropriate, and the
Purchaser can bear the economic risk of a total loss of its investment in the
Shares. The Purchaser has not been formed for the specific purpose of
acquiring the Shares.
5.5
Purchase Entirely For Purchaser’s Own
Account.
This Agreement is made with the Purchaser in reliance
upon the Purchaser's representations to the Stockholder. By
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13D
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|
entering
into this Agreement, the Purchaser hereby confirms that the Shares to be
acquired by the Purchaser will be acquired for investment for the Purchaser's
own account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof except in compliance with all applicable
securities laws, that no other person or entity has a direct or indirect
beneficial interest in the Shares being acquired by the Purchaser, and that the
Purchaser has no present intention of selling, granting any participation in, or
otherwise distributing the same. However, notwithstanding the foregoing, the
Purchaser may convey the Shares to be acquired to an affiliated designee as
hereinafter defined.
5.6
Privately Negotiated
Sale.
The Purchaser acknowledges the pre-existing professional
relationship that existed between its principals and executive officers of the
Stockholder and the Company and states that, to the best of his knowledge and
belief, no public advertisement or general solicitation was employed in
connection with the proposed transaction and that the terms and conditions of
this Agreement have been negotiated by the parties on an arms’ length
basis. By executing this Agreement, the Purchaser further represents
that the Purchaser does not presently have any contract, undertaking, agreement
or arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to any of the Shares.
5.7
Compliance With U.S.
Law.
(a) The Purchaser represents and warrants
that: (i) neither the Purchaser or its affiliates is a senior
official in the executive, legislative, administrative, military, or judicial
branch of a foreign government or a senior executive of a foreign
government-owned corporation; (ii) it is not a citizen or resident of, or
incorporated, chartered, or otherwise organized under the laws of, a
jurisdiction that has been designated under Section 311 or 312 of the
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (the “
USA
Patriot Act
,” Pub. L. No. 107-56) as warranting special measures due to
money laundering concerns; and (iii) the Purchaser’s funds do not originate
from, nor will they be routed through, an account maintained at a foreign bank
that does not have a physical presence in any country or a bank organized or
chartered under the laws of a jurisdiction that has been designated under
Section 311 or 312 of the USA Patriot Act as warranting special measures
due to money laundering concerns.
(b) The
Purchaser acknowledges and agrees that the purchase or acquisition, directly or
indirectly, of the Shares by or on behalf of the following persons or entities
(each hereafter a “
Prohibited
Investor
”) is prohibited: (i) a person or entity whose name
appears on the List of Specially Designated Nationals and Blocked Persons
maintained by the United States Office of Foreign Assets Control (“
OFAC
”);
(ii) a foreign bank that does not have a physical presence in any country; (iii)
a person or entity resident in or whose subscription funds are transferred from
or through an account in a jurisdiction that has been designated under
Section 311 or 312 of the USA Patriot Act as warranting special measures
due to money laundering concerns; (iv) a person or entity whose name appears on
any other list of prohibited persons and entities as may be mandated by
applicable law or regulation; or (v) a person or entity whose name appears on
any other list of prohibited persons and entities as may be provided to the
Purchaser by the Stockholder. The Purchaser represents, warrants, and
covenants that neither the Purchaser, nor any person controlling, controlled by,
or under common control with the Purchaser, nor any person having a beneficial
interest in the Purchaser, is a Prohibited Investor, and that the Purchaser is
not purchasing and will not purchase on behalf of or for the benefit of any
Prohibited Investor. The Purchaser agrees to promptly notify the
Stockholder of any change
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in
information affecting this representation, warranty, and
covenant. The Purchaser acknowledges that if, following the
Purchaser’s purchase of the Shares, the Stockholder or the Company reasonably
believe that the Purchaser is a Prohibited Investor, or has otherwise breached
any material representation, warranty, or covenant hereunder, the Stockholder or
the Company may be obligated to freeze the Purchaser’s investment, either by
prohibiting additional investments, declining any redemption requests, and/or
segregating the assets constituting the investment in accordance with applicable
regulations, or its investment may immediately be redeemed (for the lesser of
cost minus distributions of cash and property valued at the fair market value
thereof, as determined by the Stockholder or the Company), and the Purchaser
shall have no claim against the Stockholder or the Company for any form of
damages or liabilities as a result of any of the above-mentioned
actions.
(c) The
Purchaser acknowledges that due to applicable money laundering laws and
regulations, the Stockholder may require further information or representations
from the Purchaser before the proposed transaction can be processed and
executed, including, without limitation, further information or representations
regarding the identification of the Purchaser and the source(s) of the
Purchaser’s funds. The Purchaser agrees to promptly provide any
information or representations deemed necessary by the Stockholder, in its sole
discretion, to comply with the anti-money laundering program.
5.8
Compliance With Local Law;
Purchaser’s Domicile.
The Purchaser represents and warrants he
is not a citizen or resident of the United States and, accordingly, his purchase
of the Shares is not subject to the Blue Sky laws of any state of the United
States. The Purchaser confirms that, to the best of his knowledge and
belief, no action is required under the laws of any foreign country on the part
of the Purchaser (as a result of his citizenship or residency), the Stockholder
or the Company in connection with the proposed transaction. Purchaser
further agrees to comply with all applicable laws and regulations in each
foreign jurisdiction in which he purchases, offers, sells or delivers Shares or
has in his possession or distributes any offering material, in all cases at his
own expense.
5.9
Indemnification.
The
Purchaser agrees to indemnify and hold harmless the Stockholder, the Company,
and their respective officers, directors, and affiliates, from and against any
and all damages, losses, liability, claims, costs and expenses whatsoever
(including reasonable attorneys’ fees) which the indemnified parties may incur
by reason of the failure of the Purchaser to fulfill any of the terms or
conditions of this Agreement, or by reason of any breach of the representations
and warranties or covenants made by the Purchaser herein or in any document
provided by the Purchaser to the Stockholder in connection with the transaction
contemplated hereby.
5.10
Survival.
The
representations and warranties of the Purchaser set forth in this Agreement
shall survive the execution of this Agreement and the transactions contemplated
thereby.
ARTICLE
VI
Other
Agreements
6.1
Option
Agreements.
The Stockholder hereby grants to the Purchaser an
option (the “
Option
”)
to purchase up to 800,000 shares of Common Stock of the Company from the
Stockholder (the “
Option
Shares
”) for a exercise price equal to US$6.00 per share(the “
Option
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Exercise
Price
”). The Option may be exercised, in whole or in part, by
the Purchaser giving notice of exercise to the Stockholder on or before March
13, 2011. If the Purchaser exercises the Option, the sale by the
Stockholder of the Option Shares and the purchase thereof by the Purchaser shall
be made on a closing date not later than ten (10) business days after the
receipt by the Stockholder of the notice of exercise, shall be based on
representations, warranties and agreements of the Stockholder and the Purchaser
similar to those contained in this Agreement and shall be subject to terms and
conditions similar to those contained in this Agreement. If the
Purchaser shall exercise the Option, on the closing date, the Purchaser shall
pay to the Stockholder the Option Exercise Price via wire transfer of
immediately available funds in exchange for a certificate or certificates
evidencing the Option Shares registered in the Purchaser’s name. If
the Purchaser fails to give notice to the Stockholder of exercise of the Option
on or before March 13, 2011, the Option shall terminate.
In addition to the foregoing, the
Stockholder hereby grants to the Purchaser the following options (the “
Annual
Options
”): (i) an option to purchase 100,000 shares of Common Stock of
the Company from the Stockholder for an exercise price equal to US$2.50 per
share as of the Closing Date, (ii) an option to purchase 100,000 shares of
Common Stock of the Company from the Stockholder for an exercise price equal to
US$3.50 per share as of the first anniversary of the Closing Date, (iii) an
option to purchase 100,000 shares of Common Stock of the Company from the
Stockholder for an exercise price equal to US$4.50 per share as of the second
anniversary of the Closing Date, and (iv) an option to purchase 100,000 shares
of Common Stock of the Company from the Stockholder for an exercise price equal
to US$5.50 per share as of the third anniversary of the closing date
(collectively, the “
Annual
Option Shares
”). The Annual Options may be exercised, in whole
or in part, by the Purchaser giving notice of exercise to the Stockholder on or
before the tenth anniversary of the grant date of the Annual Option being
exercised. If the Purchaser exercises the Annual Options, the sale by
the Stockholder of the Annual Option Shares and the purchase thereof by the
Purchaser shall be made on a closing date not later than ten (10) business days
after the receipt by the Stockholder of the notice of exercise, shall be based
on representations, warranties and agreements of the Stockholder and the
Purchaser similar to those contained in this Agreement and shall be subject to
terms and conditions similar to those contained in this Agreement. If
the Purchaser shall exercise the Annual Option, on the closing date, the
Purchaser shall pay to the Stockholder the respective Option Exercise Price via
wire transfer of immediately available funds in exchange for a certificate or
certificates evidencing the Annual Option Shares registered in the Purchaser’s
name. If the Purchaser fails to give notice to the Stockholder of
exercise of the Annual Options on or before the tenth anniversary of the grant
date, the Annual Option shall terminate.
6.2
Board Seat; Voting Agreement.
The Stockholder agrees to nominate and/or cause the Purchaser (or his designee)
to be elected to the Company’s Board of Directors at each annual meeting of
stockholders or, if there shall at any time be director classes, at each such
meeting at which the Purchaser’s director class comes up for election, for so
long as the Purchaser owns at least 200,000 shares of the Company’s Common
Stock, and the Stockholder agrees to vote all, or cause (to the extent within
its control) to be voted, all shares of Common Stock of the Company owned or
controlled by the Stockholder, directly or indirectly, to be voted, to elect the
Purchaser (or his designee) to serve on the Company’s Board of Directors for so
long as the Purchaser owns at least 200,000 shares of the Company’s Common
Stock. The Purchaser hereby agrees to serve on the Company’s Board of
Directors if elected. The Purchaser shall be entitled to receive such
compensation for his Board service as may received by other non-
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employee
members of the Company’s Board of Directors including without limitation annual
fees, meeting attendance fees and annual grants of options to purchase shares of
Common Stock of the Company.
6.3
Reservation of
Shares.
After the closing date, the Stockholder shall reserve,
maintain and keep available for issuance at all times when the Option or any
Annual Options are outstanding, solely for the purpose of permitting the
Purchaser to effect the exercise of the Option or Annual Options described in
Section 6.1 above, the total number of Option Shares and Annual Option Shares
issuable upon exercise of the outstanding Option or Annual Options.
ARTICLE
VII
Miscellaneous
7.1
Transaction
Expenses.
Each party shall pay its own expenses (including
legal fees) incident to the negotiation and preparation of this Agreement and
any other documents prepared in connection therewith, and the consummation of
the transactions contemplated herein.
7.2
Entire
Agreement.
This Agreement contains the entire agreement of the
parties hereto with respect to the purchase of the Shares and the granting of
the Option and the Annual Options, and supersedes all prior understandings and
agreements (oral or written) of the parties with respect to the subject matter
hereof. The parties expressly represent and warrant that in entering
into this Agreement they are not relying on any prior representations made by
any party concerning the terms, conditions or effects of this
Agreement.
7.3
Severability.
Each
provision of this Agreement is intended to be severable from every other
provision of the Agreement, and the invalidity or illegality of any provision in
this Agreement shall not affect the validity or legality of the other
provisions.
7.4
Execution in
Counterpart.
This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
7.5
Governing Law, Venue and
Jurisdiction.
This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without regard
to conflicts of laws principles, and all disputes arising out of or related to
interpretation or performance of this Agreement shall be referred
exclusively to the federal or state courts having jurisdiction over disputes
arising in San Diego County, California. Both parties waive all
objections to the jurisdiction of said courts for this limited
purpose.
7.6
Confidentiality.
Except
as may be required by law, rule or regulation, neither of the Stockholder or the
Purchaser or their affiliates, agents or representatives shall disclose to any
third party, other than the Company, the subject matter or terms of
this Agreement without the prior consent of the other party.
7.7
Assignment.
Neither
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by either party hereto without the prior consent of the other
party. Notwithstanding the foregoing, the Purchaser may, without the
prior consent of the Stockholder, assign or transfer, in whole or in part, his
rights and obligations under this Agreement to one or more
Affiliates. For purposes of this Agreement, the term “Affiliate”
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means any
entity which, directly or indirectly, is controlled by the
Purchaser. The term “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such entity, whether through ownership or otherwise.
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7.8
Brokerage.
Each
party to this Agreement represents and warrants that it has not used or retained
a broker, dealer, agent, or finder and that it has not incurred any obligation
or liability, contingent or otherwise, to pay a fee, commission, and any other
form of remuneration, directly or indirectly, in connection with this Agreement
or any transaction contemplated thereby.
IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed
as of the day and year first above written.
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PURCHASER:
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STOCKHOLDER:
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Argyll
Biotechnologies LLC
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/s/ Myron W. Wentz, Ph.D
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By:
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/s/ James T. Miceli
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Myron
W. Wentz, Ph.D.
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Name:
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James
T. Miceli
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Title:
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CEO
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Address:2602C
Transportation Avenue
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National
City, CA 91950
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Telephone
#: 801-201-8084
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