UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No.____________)*
Cistron Biotechnology, Inc.
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
172849 10 1
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(CUSIP Number)
Harvey Wm. Glasser
2000 Powell Street, Suite 1650
Emeryville, California 94608
(510)601-1044
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 20, 1999
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(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box [ ].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
<PAGE>
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
CUSIP No. 172849 10 1 13D
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1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Harvey Wm. Glasser
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS (SEE INSTRUCTIONS)
Other - OO
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5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
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NUMBER OF 7 SOLE VOTING POWER
SHARES 186,500
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 0
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 186,500
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10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
186,500
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(SEE INSTRUCTIONS)
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1
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14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN
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<PAGE>
Schedule 13D
Item 1. Security and Issuer
This statement relates to the Common Stock of Cistron Biotechnology,
Inc. ("Cistron"). Cistron's executive offices are located at 10 Bloomfield
Avenue, Pine Brook, New Jersey, 07058.
Item 2. Identity and Background
(a) Harvey Wm. Glasser.
(b) 2000 Powell Street, Suite 1650, Emeryville, California.
(c) Chairman of the Board, President and Chief Executive Officer
Western Property Holdings.
(d) The Reporting Person has not, during the last five years, been
convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors).
(e) During the last five years, the Reporting Person was not a party
to a civil proceeding of judicial or administrative body of
competent jurisdiction resulting in the Reporting Person becoming
subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to,
federal or state securities laws or finding any violation with
respect to such laws.
(f) United States of America.
Item 3. Source and Amount of Funds or Other Consideration
The Reporting Person owns 186,500 shares of Common stock, which he
acquired in 1995. The total purchase price of these shares was $20,052.02 and
was paid with personal funds of the Reporting Person.
As described below, the Reporting Person has beneficially owned an
additional 5,058,406 shares (the "Additional Shares"), which he acquired from
the bankruptcy estate (the "Estate") of Dr. Henry Grausz ("Grausz"). Grausz had
used the Additional Shares (as well as another 500,000 shares of Common Stock)
as collateral for loans from Imperial Bank ("Imperial") for which the Reporting
Person had also provided additional security. Imperial subsequently transferred
the secured loans to Imperial Loan Management Corporation ("ILMC"). Imperial
financed ILMC's purchase of the loans and obtained a security interest in the
Additional Shares (and in the additional 500,000 shares and security provided by
the Reporting Person). ILMC entered into an agreement with Grausz dated as of
April 20, 1999 (the "Bankruptcy Agreement"), which the bankruptcy court
administering Grausz's bankruptcy case approved by final order (the "Court
Order"), under which Grausz agreed to transfer the Additional Shares to ILMC, or
its designee, in satisfaction of a portion of the debt owing by Grausz to ILMC.
ILMC designated the Reporting Person the buyer pursuant to the agreement between
ILMC and the Reporting Person described below.
On June 21, 1999, the Reporting Person entered into an agreement (the
"Sale Agreement") to sell the Additional Shares to Cistron in exchange for
$1,150,000 or a per share price of $0.2274 in a private transaction (the "Sale
Transaction"). In accordance with the terms of agreements between the Reporting
Person and Imperial and ILMC, most of the proceeds were used to pay down ILMC's
debt to Imperial and other obligations of ILMC. Some of the proceeds were paid
to the Estate in accordance with the terms of the Court Order and Bankruptcy
Agreement. The closing of the Sale Transaction occurred on July 8, 1999.
<PAGE>
Item 4. Purpose of Transaction
As noted in response to Item 3 above, the Reporting Person acquired the
Additional Shares from the Estate in satisfaction of a portion of Grausz's debt
to ILMC. Pursuant to the Bankruptcy Agreement and the Court Order (and a prior
order of the bankruptcy court), the Reporting Person agreed to try to sell the
Additional Shares to make the payment to the Estate and the other payments
described in the response to Item 3 above. The Reporting Person did not acquire
the Additional Shares for the purpose of joining and has no intent to join the
Board of Cistron or exercise controlling voting power or otherwise pursue any
plan or proposal of the type identified in Item 4.
Item 5. Interest in Securities of the Issuer
The Reporting Person has sole voting power and sole dispositive power
with respect to 186,500 shares of Common Stock, representing approximately 1% of
the outstanding share of Common Stock (as taken from Cistron's most recent 10K
filing). The Reporting Person ceased to be the beneficial owner of more than
five percent of the Common Stock on Cistron on July 8, 1999 pursuant tot he Sale
Transaction described in the response to Item 3 above.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
See Response to Item 3 above. Copies of the Court Order, the Bankruptcy
Agreement, and the Sale Agreement are attached as Exhibits hereto.
Item 7. Material to be Filed as Exhibits
Exhibit 99.1 - Court Order
Exhibit 99.2 - Bankruptcy Agreement
Exhibit 99.3 - Sale Agreement
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: July 19, 1999 /s/ Harvey Wm. Glasser
---------------------------
Harvey Wm. Glasser
<PAGE>
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF MARYLAND
(Greenbelt Division)
In re: )
)
DR. HENRY GRAUSZ, M.D. ) Case No. 97-24657-PM
) (Chapter 11)
Debtor-in-possession. )
- --------------------------------------------)
Upon the Motion for Authority to Sell Cistron Stock Fee and clear of
Liens, Claims, and Other Interests (the "Cistron Sale Motion") filed by Dr.
Henry Grausz, M.D., the debtor and debtor-in-possession herein ("debtor"), the
parties hereto hereby stipulate and agree and the Court hereby finds as follows:
WHEREAS, on December 29, 1997, (the "Petition Date") the Debtor filed
in this Court a Petition under Chapter 11 of the Bankruptcy Code commencing this
bankruptcy case (the "Case"); and
WHEREAS, the Debtor owns 5,558,406 shares of capital stock (the
"Cistron Stock") in Cistron Biotechnology, Inc. ("Cistron"); and
WHEREAS, the Cistron Stock Motion seeks authority for the Debtor to
sell 5,058,406 shares of the Cistron Stock (the "Large Block") to Imperial Loan
Management Corporation ("Imperial Loan") or its designee (the "Imperial Cistron
Stock Purchaser"); and
WHEREAS, Imperial Loan asserts and the Debtor and the Committee
stipulate that Imperial Loan holds a duly-perfected first-priority lien in the
Cistron Stock pursuant to a General Security Agreement executed by the Debtor,
dated December 21, 1993; and
WHEREAS, the Debtor is indebted to Imperial Loan pursuant to a
Promissory Note dated June 10, 1994 in the original amount of $250,000 and a
Promissory Note dated April 20, 1995 in the original principal amount of
$250,000, both as amended by a Modification and/or Extension Agreement dated as
of April 20, 1995, a Modification and/or Extension Agreement dated as of April
30, 1996, a Modification and/or Extension Agreement dated July 18, 1997, and a
Letter Agreement dated October 23, 1997 (the "1994/1995 Imperial Notes"); and
(2) a Promissory Note dated August 30, 1996 as extended, modified, and amended
by a Letter Agreement dated October 23, 1997, and two Letter Agreements dated
December 23, 1997 (the "1996 Imperial Note"); and
WHEREAS, on February 12, 1999, the Court entered its Consent Order (1)
Granting Debtor's Motion for Authority to Sell Real Property Located in Marin
County, California, Free and Clear or All Liens, Claims, and Other Interests;
(2) Granting Relief From the Automatic Stay to Dr. Harvey Glasser; and (3)
granting Other and Further Relief With Respect to Imperial Loan Management
Corporation (the "Consent Order"); and
WHEREAS, all capitalized terms in this Order that are not defined
herein shall have the meanings given such terms in the Consent Order; and
WHEREAS, reasonable notice of the Cistron Sale Motion has been provided
to all interested parties, including without limitation Cistron and all parties
who have claimed a lien on or interest in the Cistron Stock, and, by virtue of
the terms of the Cistron Sale Motion, the Consent Order (and the notice of the
<PAGE>
motion seeking entry thereof) and the consent of all affected parties, including
the Committee, reasonable notice of the material provisions of this Order and an
opportunity for hearing has also been provided to all interested parties, all in
accordance with all applicable requirements of the Federal Rules of Bankruptcy
Procedure and the Bankruptcy Code; and
WHEREAS, this Order is in the best interests of the Debtor, the Estate,
and the Debtor's creditors, and the purchase price and other consideration for
the Cistron Stock as described in the Cistron Sale Motion and the Consent Order
represents fair and reasonable value to the Debtor and the Estate; and
NOW THEREFORE, it is hereby
ORDERED, that the Cistron Sale Motion be and is hereby GRANTED as set
forth herein; and it is further
ORDERED, that the form of agreement providing for the sale of the Large
block to the Imperial Loan Cistron Stock Purchaser attached hereto as Exhibit A,
with such modifications thereto as to which the Debtor (with the consent of the
Committee) and the Imperial Cistron Stock Purchaser may agree, be and is hereby
APPROVED, and the Debtor may entered into and execute such agreement; and it is
further
ORDERED, that the Debtor may sell the Large Block to the Imperial
Cistron Stock Purchaser on the terms and conditions described in the Consent
Order and the Cistron Sale Motion; and it is further
ORDERED, that, in accordance with the terms of the Consent Order, the
purchase price for the Large Block shall be a credit against the balance of the
1996 Imperial Note (and the other consideration set forth in the Consent Order);
and it is further
ORDERED, that, following the sale of the Large Block to the Imperial
Cistron Stock Purchaser, Imperial Loan shall retain its claims under the
1994/1995 Imperial Notes (and its liens on real property of the Debtor securing
those claims) subject to the terms of the Consent Order; and it is further
ORDERED, that pursuant to Section 363(f) of the Bankruptcy Code, the
sale of the Large Block to the Imperial Cistron Stock Purchaser as described in
the Cistron Sale Motion shall be fee and clear of all liens, claims, charges,
encumbrances, and other interests of any kind of any person or entity, except
for the rights of the Debtor and the Estate as described in the Cistron Sale
Motion (and except that, at the election of Imperial Loan and Imperial Bank,
such sale shall be subject to the continued lien of Imperial Bank); and it is
further
ORDERED, that Cistron Biotechnology, Inc. and its transfer agent and/or
any other required persons or entities shall take any and all steps necessary to
transfer and/or reregister or reissue the Cistron Stock upon written request of
the Imperial Cistron Stock Purchaser and/or the Debtor;
ORDERED, that Debtor may execute any documents (including, without
limitation, a bill of sale) necessary to effectuate, and take all actions and
execute all documents necessary to implement, the agreement providing for the
sale of the Cistron Stock; and it is further
ORDERED and FOUND, that the Imperial Cistron Stock Purchaser is a good
faith purchaser under, and is entitled to the protections of, Section 363(m) of
the Bankruptcy Code; and it is further
ORDERED, that the Debtor is hereby authorized to sell the Small Block
(and other stock in Cistron that the Debtor owns or acquires as a result of any
stock options), or portions thereof, from time to time in the ordinary course of
business in market transactions, or in connection with a sale of the Large Block
as and
<PAGE>
to the extent provided in the Consent Order, provided that the Committee consent
in writing to each such sale; and it is further
ORDERED, that this Order is a final and immediately appealable order.
To the extent necessary under Bankruptcy Rule 9014, the Court hereby finds that
there is no reason for delay in the implementation of this Order; and it is
further
ORDERED, that nothing in this Order shall be deemed to modify the
Consent Order, which Consent Order shall be deemed incorporated herein.
Dated: March 16, 1999 /s/ Paul Mannes
------------------------------
United States Bankruptcy Judge
cc: Bradford F. Englander, Esquire
1010 Wayne Avenue, 10th Floor
Silver Spring, Maryland 20910
Daniel M. Litt, Esquire
Dickstein, Shapiro Morin & Oshinsky LLP
2101 L Street, N.W.
Washington, D.C. 20037-1526
Philip D. Anker, Esquire
Wilmer, Cutler & Pickering
2445 M Street, N.W.
Washington, D.C. 20037-1429
Office of the U.S. Trustee
6305 Ivy Lane, Suite 600
Greenbelt, Maryland 20770
<PAGE>
This CISTRON STOCK SALE AGREEMENT (this "Agreement") dated as of April 20, 1999,
between DR. HENRY GRAUSZ as debtor in possession (the "seller") and IMPERIAL
LOAN MANAGEMENT CORPORATION ("Imperial Loan").
WHEREAS, the Seller fled a voluntary petition under Chapter 11 of the
United States Bankruptcy Code on December 29, 1997, in the United States
bankruptcy Court for the District of Maryland, Greenbelt Division (the "court"0;
WHEREAS, the Seller owns 5,558,406 shares of common stock (the "Cistron
Stock") in Cistron Biotechnology, Inc. ("Cistron"), which has been pledged to
secure certain obligations of Seller to Imperial Loan;
WHEREAS, Seller desires to sell a portion of the Cistron Stock
aggregating 5,058,406 shares (the "large Block") to Imperial Loan or its
designee ("0purchaser"0, subject to the approval of the Court, on the terms et
forth herein;
WHEREAS, Seller has filed a motion with the Court to sell the Large
Block, and possibly the Small Block, or a portion thereof, pursuant to certain
terms and conditions as are set forth herein, free and clear of all liens,
claims and other interests, except as specifically otherwise provided in the
Consent Order, pursuant to Section 363 of the United States Bankruptcy Code and
Rule 6004 of the Federal Rules of bankruptcy Procedure (the "Cistron Stock
Motion"); and
WHEREAS, the parties desire to provide for certain undertakings,
conditions, representations, warranties, and covenants in connection with the
transactions contemplated hereby.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto do hereby agree as
follows:
ARTICLE 1
DEFINITIONS
Section 1.01 Defined terms. All capitalized terms not otherwise defined herein
shall have the meanings given such terms in that certain Consent Order (1)
Granting Debtor's Motion for Authority to Sell Real Property Located in Marin
County, California, Free and Clear of All Liens, Claims and Other Interests; (2)
Granting Relief From the Automatic Stay to Dr. Harvey Glasser; and (3) granting
Other and Further Relief With Respect to Imperial Loan Management Corporation,
which was entered on February 12, 1999 by the Court (the "Consent Order").
ARTICLE 2
PURCHASE AND SALES OF SHARES
Section 2.01 Sale of Large Block.
(a) The transactions contemplated by this Agreement shall be
consummated at a Closing (the "Closing") on or before April 23, 1999, or such
other date as the Seller and Purchaser may agree in writing (the "Closing
Date").
(b) [intentionally omitted]
(c) At the Closing, upon satisfaction of, or appropriate
waiver of, all of the conditions contained in Article 5 hereof, the Seller shall
sell and deliver to Purchaser, and Purchaser shall purchase
<PAGE>
from the Seller, 5,058,406 shares (the "Large Block") of common stock in Cistron
in exchange for a credit against the balance of the 1996 Imperial Note and the
other consideration set forth in the Consent order (the "purchase Price"). Such
sale shall be free of all liens, claims and encumbrances, except as specifically
otherwise provided in the consent Order. At the Closing, the Seller shall
deliver to Purchaser a bill of sale or stock power, in a form reasonably
acceptable to Purchaser, evidencing the sale of the Large Block to Purchaser.
Purchaser already has possession of, or following the Closing shall obtain
possession of, the certificates representing the Large Block. Purchaser and
Seller shall take all reasonable actions at the Closing and thereafter
(excluding delivering any legal opinions) necessary to accomplish the transfer
of the Large Block to Purchaser and the release and delivery of the Small Block
in the name of the Seller, with the certificate for the Large block delivered to
the Purchaser and the certificate for the Small Block delivered to the Seller.
Section 2.02 [Intentionally Omitted]
Section 2.03 Sale of Shares; Application of Proceeds by Purchaser. Following the
Closing, the parties shall comply with the Consent Order with respect to any
possible resale of the Large block by Purchaser within one year following the
Closing.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller hereby represents and warrants to Purchaser as follows:
Section 3.01 Warranty of Title to the Large Block. The Seller has, or will have
as of the Closing, the ability to transfer valid and marketable title to the
Large Block to Purchaser, pursuant to an order of the Court, and, upon its
transfer to Purchaser pursuant to Section 2.01, Purchaser will have valid title
to the large Block, free and clear of any pledges, liens, security interests,
options, restrictions on transfer or other encumbrances, other than as
specifically set forth in the consent Order and those restrictions on transfer
imposed through acts of Purchaser or by applicable State or Federal securities
laws, rules, or regulations.
Section 3.02 Seller's Disclaimer Of Representations And Warranties. Purchaser
acknowledges and agrees that, except as expressly stated in this Agreement and
the Consent Order, Seller has not made, does not make, and specifically
disclaims any representations, warranties, promises, covenants, agreements or
guaranties of any kind or character whatsoever, whether express or implied, oral
or written, past, present or future, of, as to, or concerning or with respect to
Cistron or the Cistron Stock. Purchaser further acknowledges and agrees that any
information provided or to be provided to Purchaser with respect to Cistron or
the Cistron Stock was or will be obtained from a variety of sources and that
Seller has not made any independent investigation or verification of such
information and makes no representation or warranty as to the accurancy or
completeness of such information. Except as provided in this Agreement or the
Consent Order, Seller is not liable or bound in any manner by any oral or
written statements, representations, appraisals, evaluations, reports or other
information pertaining to Cistron or the Cistron Stock as may have been
furnished to Purchaser by Seller or his agents or representatives. Purchaser
further acknowledges and agrees that to the maximum extent permitted by law, the
sale of the Large Block as provided in this Agreement is made without recourse
except for the representations and warranties of Seller contained in this
Article 3. Purchaser and Seller understand that pursuant to State and/or Federal
securities laws, Purchaser may be precluded from making any transfer or other
disposition of any of the Large Block unless a specific exemption from the
registration requirements is available with respect to any particular
transaction. Purchaser further acknowledges and agrees that the Large block may
bear an appropriate restrictive legend to the effect that the Large Block may
not be sold or transferred without registration or the availability of a valid
exemption form registration, and that an acceptable opinion of counsel may be
required by the issuer.
<PAGE>
ARTICLE 4
REPESENTATIONS AND WARRANTIES OF THE PURCHASER
Purchaser hereby represents and warrants to the Seller as follows:
Section 4.01 Authorized and Effective Agreement.
(a) Purchaser has all requisite power and authority to enter
into and perform all of its obligations under this Agreement. The execution and
delivery of this Agreement and consummation of the transaction contemplated
hereby have been duly and validly authorized by all necessary action in respect
thereof on the part of Purchaser. This Agreement constitutes a legal, valid and
binding obligation of Purchaser, enforceable against it in accordance with its
terms subject, as to enforceability, to bankruptcy, insolvency and other laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
(b) Neither the execution and delivery of this Agreement, nor
consummation of the transactions contemplated hereby, nor compliance by
Purchaser with any of the provisions hereof shall (i) constitute or result in a
breach of any term, condition or provision of, or constitute a default under any
note, bond, mortgage, indenture, license, agreement or other instrument or
obligation by Purchaser, or (ii) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to Purchaser.
Section 4.02 [Intentionally Omitted.]
Section 4.03 Purchaser's Due Diligence. At the time of the execution of this
Agreement and at Closing, Purchaser shall have made such examination, review and
investigation of the facts and circumstances necessary to evaluate Cistron and
the Large block as it has deemed necessary or appropriate to form a basis for
its decision to purchase the Large Block. Purchaser is assuming all risk with
respect to the completeness, accuracy, or sufficiency of its examination, review
and investigation. Purchaser has agreed to the Purchase Price on the basis of
its own independent investigation and evaluation of Cistron and has not sought
or relied upon any representations, warranties, information, covenants or
agreements of Seller (other than the express representations, warranties,
information, covenants, and agreements set forth in this Agreement and the
Consent Order).
Section 4.04 Accredited Investor. The Purchaser shall be an "accredited
Investor" as such term is defined under Section 501(a) of Regulation D of the
Securities Act of 1933 (the "1933 Act").
Section 4.05 Sophistication; Investment Intent. Purchaser, its agents and
representatives, have such knowledge and experience in financial and business
matters as to enable them to utilize the information made available to them in
connection with the purchases contemplated hereby, to evaluate the merits and
risks of an investment in Cistron and to make an informed decision with respect
thereto. Purchaser is acquiring the Large Block hereunder not with a view to
making a distribution thereof within the meaning of the 1933 Act. Such shares
will not be sold or transferred by Purchaser in violation of the securities laws
of the United States or any state thereof or other jurisdiction.
ARTICLE 5
CONDITIONS PRECEDENT
Section 5.01 Conditions Precedent - Purchaser and the Seller.
<PAGE>
The respective obligations of Purchaser and Seller to effect
the transactions contemplated by this Agreement at the Closing Date shall be
subject to satisfaction or waiver by each party of the following conditions:
(a) Neither Purchaser nor the Seller shall be subject to any
order, decree or injunction or a court or agency of competent jurisdiction which
enjoins or prohibits consummation of the transactions contemplated by this
Agreement.
(b) The court shall have entered an order in a form reasonably
acceptable to the Purchaser, the Seller and the committee granting the Cistron
Stock Motion (the "approval Order"). Such Approval Order shall remain in full
force and effect and shall not be stayed, modified, rescinded, or revoked.
Section 5.02 Conditions Precedent - the Seller.
The obligations of the Seller to effect the transactions
contemplated by this Agreement at the Closing date shall be subject to
satisfaction of the following additional conditions at or prior to the Closing
Date unless waived by the Seller and the Committee:
(a) The representations and warranties of Purchaser set forth
in Article 4 hereof shall be true and correct in all material respects as of the
date of this Agreement and as of such Closing Date as though made on and as of
the Closing Date (or on the date when made in the case of any representation and
warranty which specifically relates to an earlier date), except as otherwise
expressly provided in this Agreement or consented to in writing by the Seller
and the Committee.
(b) Purchaser shall have in all material respects performed
all obligations and complied with all covenants required by this Agreement.
Section 5.03 Conditions Precedent - Purchaser.
The obligations of Purchaser to perform under this Agreement
shall be subject to satisfaction of the following additional conditions at or
prior to the Closing Date unless waived by Purchaser:
(a) The representations and warranties of the Seller set forth
in Article 3 hereof shall be true and correct in all material respects as of the
date of this Agreement and as of such Closing Date as though made on and as of
the Closing Date (or on the date when made in the case of any representation and
warranty which specifically relates to an earlier date), except as otherwise
contemplated by this Agreement or consented to in writing by Purchaser.
(b) The Seller shall have in all material respects performed
all obligations and compiled with all covenants required by this Agreement.
ARTICLE 6
MISCELLANEOUS
Section 6.01 Expenses. In the event of any disputes concerning the enforcement
or interpretation of this Agreement whichever party to the dispute which does
not prevail in its prosecution or defense of the dispute (the "Non-Prevailing
Party") shall reimburse the party which prevails in such dispute (the
"Prevailing Party") for all expenses and for any costs incurred by the
Prevailing Party, including reasonable attorney's fees and costs. Except as
expressly provided in the foregoing sentence, each party shall bear and pay all
<PAGE>
fees, expenses and costs that it incurred in connection with the transactions
contemplated by this Agreement, including without limitation, fees and expenses
of its own financial consultants, accountants and counsel.
Section 6.02 Waiver. Each party hereto by such party (if such party is an
individual) or by an authorized officer of such party (if such party is
corporation), and by counsel for or an authorized representative of the
Committee, may at any time extend the time for the performance of any of the
obligations or other acts of the other party hereto and may waiver (i) any
inaccuracies of the other party in the representations or warranties contained
in this Agreement or any document delivered pursuant hereto, (ii) compliance
with any of the covenants, undertakings or agreements of the other party, or
satisfaction of any of the conditions precedent to its obligations, contained
herein or (iii) the performance by the other party of any of its obligations set
out herein. No waiver or extension shall be effective unless it is in writing
signed by such parties.
Section 6.03 Amendment or Supplement. This Agreement may be amended or
supplemented in writing at any time by mutual agreement of Purchaser and the
Seller, with the written consent of the Committee. No modification or amendment
of, or supplement to, this Agreement shall be effective unless signed by such
parties.
Section 6.04 Entire Agreement. This Agreement, the Consent Order, and the
Approval Order contain the entire agreement between the parties with respect to
the transactions contemplated hereunder and together supersede all prior
arrangements or understandings with respect thereto, written or oral, other than
documents referred to herein. The terms parties hereto, and their respective
successors. Nothing in this Agreement, expressed or implied, is intended to
confer upon any party, other than the parties hereto (and any Designee), and
their successors, any rights, remedies, obligations or liabilities.
Section 6.05 No Assignment. Imperial Loan may assign its rights subject to its
obligations under this Agreement to any person or entity that is an accredited
investor as provided in Section 4.04 hereof ("Designee"). Subject to the
limitations set forth in the Consent Order, the Seller may assign his rights,
but not his obligations, under this Agreement.
Section 6.06 Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered personally
or sent by overnight express, or by registered or certified mail, postage
prepaid, addressed as follows:
If to the Seller:
Dr. Henry Grausz
101 Lounsbury Place
Falls Church, Virginia 22046
With a required copy to:
Bradford F. Englander, Esq.
Linowes and Blocher LLP
Tenth Floor
1010 Wayne Avenue
Silver Spring, Maryland 20910
<PAGE>
If to Purchaser:
Imperial Loan Management Corporation
c/o Peter Schneider
18150 Cottonwood Road, #423
Sunriver, Oregon 97707
Fax: (541) 593-3399
Dr. Harvey Wm. Glasser
c/o Western Property Holdings
2000 Powell Street, Suite 1650
Emeryville, California 94608
Fax: (510) 601-8631
With a required copy to:
Phillip D. Anker, Esq.
Wilmer, Cutler & Pickering
2445 M Street, NW
Washington, DC 20037-1420
If to the Committee:
Daniel M. Litt, Esq.
Diskstein, Shapiro, Morin & Oshinsky
2101 L Street, NW
Washington, DC 20037
Section 6.07 Captions. The captions contained in this Agreement are for
reference purposes only and are not part of this Agreement.
Section 6.08 Severability. If any provision of this Agreement shall be
determined illegal or unenforceable by any court of law, the remaining
provisions shall be severable and enforceable in accordance with their terms.
Section 6.09 Counterparts. This Agreement may be executed in any number of
counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.
Section 6.10 Time of the Essence. The parties hereto agree that time is of the
essence.
Section 6.11 Jury Trial Waiver. THE PARTIES HERTO AGREE TO WAIVE ANY RIGHT THEY
MAY HAVE TO A TRIAL BY JURY OF ANY ISSUES RAISED IN ANY ACTION ALLEGING A BREACH
OF THIS AGREEMENT.
Section 6.12 Governing Law and Jurisdiction. The validity, enforcement and
interpretation of this Agreement shall be governed by the laws of the State of
Maryland without giving effect to the conflict of laws principles thereof,
except to the extent that the bankruptcy Code controls.
Section 6.13 Court Orders. In the event that there is any conflict between this
Agreement and the Consent Order and/or the Approval Order, the terms of such
orders shall take precedence.
[SIGNATURE PAGE FOLLOWS]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have signed, executed and entered into
this Agreement, under seal, all as of the day and year first above written.
IMPERIAL LOAN MANAGEMENT CORPORATION
By: /s/ Peter Schneider [SEAL]
-------------------------------
Name: Peter Schneider
-----------------------------
Title: President
----------------------------
/s/ Henry Grausz
-----------------------------------
Dr. Henry Grausz, as debtor in possession [SEAL]
Purchaser Designation
Imperial Loan Management Corporation hereby designates Dr. Harvey Wm. Glasser as
the "Purchaser" and Designee," and Dr. Glasser hereby joins in this Agreement as
Purchaser and Designee, acknowledges and accepts such designation, and agrees to
be bound by the terms hereof that are binding upon Purchaser, and confirms the
representations and warranties of Purchaser as set forth above.
IMPERIAL LOAN MANAGEMENT CORPORATION
By: /s/ Peter Schneider [SEAL]
--------------------------------
Name: Peter Schneider
------------------------------
Title: President
-----------------------------
/s/ Harvey Wm. Glasser
------------------------------------
Dr. Harvey Wm. Glasser
<PAGE>
PURCHASE AGREEMENT
This PURCHASE AGREEMENT (the "Agreement") is made and entered into as
of June 21, 1999, by and among Dr. Harvey Wm. Glasser ("Glasser") and Cistron
Biotechnology, Inc., a Delaware corporation ("Cistron").
WITNESSETH:
WHEREAS, Glasser acquired 5,058,406 shares (the "Shares") of common
stock, par value $0.01 of Cistron (the "Common Stock"), pursuant to that certain
Cistron Stock Sale Agreement dated as of April 20, 1999 (the "Original Stock
Sale Agreement") between Dr. Henry Grausz as debtor in possession (the "Debtor")
and Imperial Loan Management Corporation (Imperial Loan"), and that certain
Irrevocable Stock Power and Assignment dated April 20, 1999 executed by the
Debtor (the "Irrevocable Stock Power");
WHEREAS, the Debtor's sale of the Shares to Glasser and the Original
Stock Sale Agreement were approved by the United States Bankruptcy Court for the
District of Maryland (the "Bankruptcy Court") pursuant to that certain Order
Grating Debtor's Motion for Authority to Sell Cistron Stock Fee and Clear of
Liens, Claims, and Other Interests dated March 16, 1999, entered by the
Bankruptcy Court in the pending bankruptcy case of the Debtor, In re Dr. Henry
Grausz, M.D., Case No. 97-24657 (PM) (the "March 16 Order"), and that certain
Consent Order (1) Granting Debtor's Motion for Authority to Sell Real Property
Located in Marin County, California, Free and Clear of all Liens, Claims and
Other Interests; (2) Granting Relief from the Automatic Stay to Dr. Harvey
Glasser; and (3) Granting Other and Further Relief with Respect to Imperial Loan
Management Corporation dated February 12, 1999 (the "Consent Order");
WHEREAS, as provided in the March 16 Order, Glasser acquired the Shares
fee and clear of all liens other than the continued liens of Imperial Bank (the
"Imperial Lien");
WHEREAS, the bankruptcy estate of the Debtor (the "Estate") continues
to own 500,000 shares of Common Stock (the "Estate Shares");
WHEREAS, the Original Stock Sale Agreement is subject to the
requirement described in the Consent Order that if Glasser sells all or part of
the Shares during the year following the closing of the Original Stock Sale
Agreement, Glasser shall require that any purchaser offer the Estate, with
respect to the Estate Shares, the opportunity to participate on the same per
share terms in such sale;
WHEREAS, Glasser desires to sell the Shares and Cistron desires to
purchase the Shares, upon the terms and subject to the conditions et forth
herein, in consideration of the payment by Cistron of the Purchase Price (as
defined in Section 1.2 below); and
WHEREAS, Cistron agrees to offer to the Estate to purchase the Estate
Shares on the terms and conditions set forth herein (the "Cistron Offer");
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein and other good an valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties, upon the terms and subject to the conditions contained herein, hereby
agree as follows:
1. Purchase of the Shares and Payment of the Purchase Price.
<PAGE>
1.1 Subject to the terms and conditions hereof, Cistron hereby agrees to
purchase from Glasser the Shares and Glasser agrees to sell to Cistron
the Shares with stock powers executed in blank.
1.2 Subject to the terms and conditions hereof, Cistron shall deliver and
pay to Glasser in consideration for the Shares an aggregate cash
purchase price of One Million One Hundred Fifty Thousand Dollars
($1,150,000) (the "Purchase Price"), or $0.2274 per share.
1.3 The Purchase Price for the Shares shall be paid by Cistron at Closing
(as defined below) in immediately available funds by wire transfer to
an account or accounts designated by Glasser. At Closing, Glasser
shall cause such portion of the Purchase Price as he is required to
transfer to the Estate under the terms of paragraph no. 28 of the
Consent Order to be so transferred and shall cause such amount of the
remainder of the Purchase Price as may be necessary to cause Imperial
Bank to release the Imperial Lien to be transferred to Imperial Bank.
2. Closing.
2.1 The closing (the "Closing") of the transaction contemplated hereunder
shall occur two business days after all the conditions set forth in
Sections 5 and 6 below are satisfied or waived, but in no event shall
Closing occur (x) earlier than five (5) business days after Cistron
provides notice by facsimile to the Estate of the Cistron Offer
pursuant to Section 7.3 of this Agreement or (y) later than July 16,
1999, at the offices of Epstein Becker & Green,P.C., 1227 25th Street,
N.W., Washington, DC 20037-1156, unless otherwise agreed to by the
parties.
2.2 At the Closing, upon satisfaction of all conditions set forth in
Sections 5 and 6 below, (i) Glasser shall deliver or cause to be
delivered to Cistron stock certificates representing the Shares, with
stock powers executed in blank, and (ii) Cistron shall deliver the
Purchase Price to Glasser (or to such account or accounts as Glasser
may designate pursuant to Section1.3 above).
3. Representations and Warranties of Cistron. Cistron hereby represents and
warrants to Glasser as follows:
3.1 Cistron has: (i) been duly organized and is validly existing and in
good standing under the laws of the State of Delaware; (ii) all
requisite capacity, power and authority to enter into, deliver and
perform this Agreement; and (iii) all requisite power and authority to
own and operate its properties and assets, and to carry on its
business, as presently conducted and as proposed to be conducted.
Cistron is duly qualified to conduct business in the jurisdictions in
which the nature of its business or the ownership of its assets makes
such qualification necessary except where the failure to so qualify
has not had and would not have, individually or in the aggregate, a
material adverse effect on the financial condition or operations of
Cistron.
3.2 All corporate action on the part of Cistron necessary for the
authorization, execution, delivery and performance of this Agreement
has been taken. This Agreement has been duly and properly executed and
delivered by Cistron, and constitutes valid and binding obligations of
Cistron, enforceable in accordance with its terms.
<PAGE>
3.3 The execution and delivery of this Agreement by Cistron does not, and
the consummation of the transactions contemplated hereby and
compliance with the terms hereof will not, conflict with or result in
any violation, loss of rights, termination or breach of or constitute
a material default (or an event which with the passage of time or
giving of notice, or both, would constitute a material default) under
(i) any provision of the Certificate of Incorporation or Bylaws of
Cistron, (ii) any judgment, order, decree, statute, law, ordinance,
rule or regulation applicable to Cistron or the property or assets of
Cistron or (iii) any agreement, deed, contract, mortgage, indenture,
writ, order, decree, legal obligation or instrument to which Cistron
is a party or to which any of its assets or properties is or may be
subject. The execution and delivery of this Agreement by Cistron does
not, and the consummation of the transactions contemplated hereby and
compliance with the terms hereof and of such other agreements and
instruments will not, result in the creation or imposition or, or give
any party the right to create or impose, any lien, charge or
encumbrance, or restriction of any nature whatsoever with respect to
any material properties or assets of Cistron or give to any other
person any interest or rights, including rights of termination,
acceleration or cancellation in, or with respect to, any of the
properties, assets or agreements of Cistron. No notification, consent,
approval, order or authorization of, or registration, declaration or
filing with, any court, administrative agency or commission or other
governmental authority or instrumentality, domestic or foreign, or
with any other person or entity is required to be obtained or made by
or with respect to Cistron in connection with the execution and
delivery of this Agreement or the consummation by Cistron of the
transactions contemplated hereby.
3.4 As of the date hereof, Cistron has made such examination, review and
investigations of the facts and circumstances necessary to evaluate
the Shares as it has deemed necessary or appropriate to form a basis
for its decision to pay the Purchase Price and purchase the Shares.
3.5 Cistron is acquiring the Shares with the intent of having the Shares
become treasury stock and not with a view to making a distribution
thereof within the meaning of the Securities Act of 1933 (the "1933
Act"). Cistron is an "Accredited Investor" as such term is defined
under Section 501(a) of Regulation D of the 1933 Act. Cistron will not
sell or transfer the Shares in violation of the 1933 Act or any other
securities laws of the United States or any state thereof or other
jurisdiction.
4. Representations and Warranties of Glasser. Glasser hereby represents and
warrants to Cistron as follows:
4.1 Glasser has the full legal right, power and authority to enter into
this Agreement and this Agreement constitutes the valid and binding
obligation of Glasser, enforceable in accordance with its terms.
4.2 Except for the Imperial Lien and Glasser's obligation to transfer to
the estate a portion of the proceeds realized from the sale of the
Shares hereunder as set forth in paragraph no. 28 of the Consent
Order, the execution and delivery of this Agreement by Glasser does
not, and the consummation of the transactions contemplated hereby and
compliance with the terms hereof will not, conflict with or result in
any violation, loss or rights, termination or breach of or constitute
a material default (or an event which with the passage of time or
giving of notice, or both, would constitute a material default) under
(i) any judgment, order,
<PAGE>
decree, statute, law, ordinance, rule or regulation applicable to
Glasser or the property or assets of Glasser or (ii) any material
agreement, deed, contract, mortgage, indenture, writ, order, decree,
legal obligation or instrument to which Glasser is a party or to which
any of his assets or properties is or may be subject. Except for the
release of the Imperial Lien and the notice of the Cistron Offer as
provided in Section 7.3 hereof, no notification, consent, approval,
order or authorization of, or registration, declaration or filing
with, any court, administrative agency or commission or other
governmental authority or instrumentality, domestic or foreign, or
with any other person or entity is required to be obtained or made by
or with respect to Glasser in connection with the execution and
delivery of this Agreement or the consummation by Glasser of the
transactions contemplated hereby and thereby.
4.3 Except for (i) the Imperial Lien, (ii) Glasser's obligation to pay to
the Estate a portion of the proceeds realized from the sale of the
Shares hereunder as set forth in paragraph no. 28 of the Consent
Order, and (iii) the Estate's "drag-along" rights as set forth in
paragraph no. 27 of the Consent Order, Glasser acquired from the
Debtor and owns the Shares free and clear of all liens, claims and
encumbrances; provided, however, Glasser may have certain obligations
to seek to sell the Shares and to apply some or all of the Purchase
Price, less the portion thereof that he is required under the terms of
paragraph no. 28 of the Consent Order to transfer to the estate, is in
satisfaction of the Imperial Lien and/or certain other debts or
Imperial Loan. At Closing, Glasser shall transfer the Shares to
Cistron free and clear of all liens, claims and encumbrances other
than any liens, claims and encumbrances created by or arising through
Cistron.
4.4 Except as expressly stated in this Agreement, Glasser has not made,
does not make, and specifically disclaims and representations,
warranties, promises, covenants, agreements or guaranties of any kind
or character whatsoever, whether express or implied, oral or written,
past, present or future, of, as to, or concerning or with respect to
Cistron or the Shares, or the value thereof.
4.5 As of the date hereof, Glasser has made such examination, review and
investigations of the facts and circumstances as he has deemed
necessary to form a basis for his decision to sell the Shares in
exchange for the Purchase Price.
5. Conditions to Cistron's Closing. The obligations of Cistron Hereunder are
subject to the following conditions, each of which must be satisfied or
waived by Cistron prior to Closing:
5.1 Representations and Warranties True. All representations and
warranties of Glasser contained in this Agreement shall be true in all
material respects at and as of the Closing as if such representations
and warranties were made at and as of the Closing, and Glasser shall
have performed and satisfied all material agreements in all material
respects as required by this Agreement to be performed and satisfied
by Glasser at or prior to the Closing.
5.2 Certificates. At the Closing, Glasser shall deliver, or cause to be
delivered, to Cistron stock certificates representing the Shares, with
stock powers executed in blank with medallion guarantees.
5.3 No Order. Cistron shall not be subject to any order, decree or
injunction of a court or agency of competent jurisdiction which
enjoins or prohibits consummation of the transactions contemplated by
this Agreement.
5.4 Other Documents. Glasser shall deliver a copy of the Original Stock
Sale Agreement, and copies of the March 16 Order and Consent Order,
which orders are in full force and effect.
<PAGE>
5.5 Release of Imperial Lien. Glasser shall provide evidence that Imperial
Bank has terminated and released the Imperial Lien on the Shares
effective at Closing and the payment by Cistron of the Purchase Price
as provided in Section 1.3 above.
5.6 Opinion. Cistron shall have received from Wilmer, Cutler & Pickering,
counsel to Glasser, an opinion addressed to Cistron, dated the Closing
Date, in substantially the form attached hereto as Exhibit A.
5.7 Affidavit from Linowes and Blocher LLP. Cistron shall have received an
affidavit from Linowes and Blocher LLP attesting to the authenticity
and genuineness of Grausz's signature on the Irrevocable Stock Power.
5.8 Resolution of Board of Directors. The Board of Directors of Cistron
shall have adopted a resolution indemnifiying Continental Stock
Transfer & Trust Company for the transfer of the Shares.
6. Conditions to Glasser's Closing. The obligations of Glasser hereunder are
subject to the following conditions, each of which must be satisfied or
waived by Glasser prior to Closing:
6.1 Resolutions. Prior to or at Closing, Glasser shall have received
resolutions of the Board of Directors of Cistron authorizing and
approving the transactions contemplated by this Agreement, certified
by the respective Secretary of Cistron, together with a certificate
issued by the Delaware Secretary of State showing that Cistron is in
good standing and authorized to do business.
6.2 Representations and Warranties True. All representations and
warranties of Cistron contained in this Agreement shall be true in all
material respects as at and as of the Closing as if such
representations and warranties were made at and as of the Closing, and
Cistron shall have performed and satisfied all material agreements in
all material respects as required by this Agreement to be performed
and satisfied by Cistron at or prior to the Closing.
6.3 No Order. Glasser shall not be subject to any order, decree or
injunction of a court or agency of competent jurisdiction which
enjoins or prohibits consummation of the transactions contemplated by
this Agreement.
6.4 Other Deliveries. Cistron shall have delivered such additional
instruments, as may be reasonably necessary or advisable to carry out
Cistron's obligations under, and to fulfill the purpose of, this
Agreement and any other document, certificate or other instructions
delivered pursuant hereto.
6.5 Receipt of Purchase Price. Cistron shall have wired the Purchase Price
to an account or accounts designated by Glasser as provided in Section
1.3 above.
6.6 Cistron Offer. Cistron shall have made (and shall not have withdrawn)
the Cistron Offer to the Estate as provided in Section7.3 below.
6.7 Release of Imperial Lien. Imperial Bank shall have terminated and
released the Imperial Lien on the Shares effective at Closing and the
payment by Cistron of the Purchase Price as provided in Section 1.3
above.
<PAGE>
6.8 Transfer. Continental Stock Transfer and Trust Company, the transfer
agent for Cistron, shall have confirmed, in writing (a copy of which
writing shall be provided to Glasser and his counsel), the
transferability of the Shares from Glasser to Cistron pursuant to this
Agreement without registration pursuant to the 1933 Act. To the extent
required by Continental to so confirm, counsel to Cistron, Epstein,
Becker & Green, P.C., shall have provided an opinion to Continental,
dated the Closing date, that registration of the Shares is not
required under the 1933 Act for the transfer of the Shares set forth
in the prior sentence of this Section.
6.9 Stock Power. Glasser shall have received from the Debtor the
Irrevocable Stock Power with a signature guarantee from Cistron, and
Cistron shall have provided to Continental Stock Transfer & Trust
Company the documentation set forth in Exhibit B attached hereto.
7. Covenants.
7.1 Expenses. Each party shall bear the legal, accounting and other
expenses incurred by such party in connection with this Agreement, and
the transactions contemplated hereby.
7.2 Further Assurances. Each of Glasser and Cistron covenant and agree
that, subsequent to the execution and delivery of this Agreement and
without any additional consideration, each of Glasser and Cistron
shall execute and deliver any further legal instruments and perform
such acts which are or may become necessary to effectuate the purposes
of this Agreement, and shall cooperate with the transfer agent for
Cistron as may be necessary to recertificate the Shares to evidence
the transfer of the Shares to Cistron.
7.3 Drag-Along Rights. On the date hereof, Cistron shall make an offer to
purchase the Estate Shares from the Estate on the same terms and
conditions, including price per share of Common Stock, $0.2274, for an
aggregate purchase price to be paid by Cistron to the Estate of One
Hundred Thirteen Thousand Seven Hundred Dollars ($113,700) (the
"Cistron Offer"). On the date hereof, Cistron shall deliver a notice,
in a form reasonably acceptable to Glasser, to the Estate setting
forth the terms of the sale and the expected date of Closing. On the
date hereof, Cistron shall cause copies of such notice to be delivered
to Bradford E. Englander at facsimile 301-495-9044 and Daniel M. Litt
at facsimile 202-887-0689.
8. Indemnification.
8.1 The representations and warranties and covenants set forth in this
Agreement will survive until the second anniversary of the date
hereof, and upon such second anniversary, all representations and
warranties and covenants and all claims not yet asserted based thereon
shall expire.
8.2 Cistron hereby agrees to indemnify Glasser and to hold him harmless
from and against any and all losses, expenses, liabilities, claims,
demands and judgments (including, without limitation, reasonable
attorneys' fees) arising out of, resulting from or relating to (i) the
breach by Cistron of any representation or warranty made by Cistron in
this Agreement or (ii) the breach of any covenant or agreement or the
non-performance of any obligation or covenant set forth in this
Agreement required to be performed by Cistron.
8.3 Glasser hereby agrees to indemnify Cistron and to hold it harmless
from and against any and all losses, expenses, liabilities, claims,
demands and judgments (including, without limitation, reasonable
attorneys' fees) arising out of, resulting from or relating to (i) the
<PAGE>
breach by Glasser of any representation or warranty made by Glasser in
this Agreement or (ii) the breach of any covenant or agreement or the
non-performance of any obligation or covenant set forth in this
Agreement required to be performed by Glasser.
8.4 The provisions of this Section8 shall apply to any claim, action or
proceeding (a "Claim") for which any person or entity seeks
indemnification under this Agreement.
(a) The party seeking indemnification (the "Indemnified Party") shall
give prompt notice to the party from whom it is seeking
indemnification (the "Indemnifying Party") of such Claim, which
notice shall include such information relating to the Claim as is
known by the Indemnified Party of any indemnification obligation
in respect to such Claim, except to the extent any failure or
delay materially prejudices the right of the Indemnifying Party
to defend such Claim. The Indemnifying Party shall have the
right, upon acknowledging in writing its indemnification
obligations hereunder, to defend such Claim at its expense by
giving written notice of such election within 30 days after
receipt of such notice from the Indemnified Party. The failure of
the Indemnifying Party to notify the Indemnified Party of whether
it elects to exercise its right to defend such Claim within such
30 day period shall be deemed an election not to defend such
Claim.
(b) If the Indemnifying Party acknowledges its indemnification
obligations and elects to defend the Claim, the remaining
provisions of this paragraph (b) shall apply. The Indemnifying
Party shall promptly and diligently pursue the defense or
settlement of the Claim. The Indemnified Party shall provide
reasonable assistance to the Indemnifying Party. The Indemnified
Party shall have the right to participate in such defense, but
any counsel employed by the Indemnified Party shall thereafter be
at its expense and the Indemnifying Party shall retain the right
to control the defense of such Claim. The Indemnifying Party
shall have the right in its sole discretion to settle such Claim
if the settlement involves only the payment of money by the
Indemnifying Party and the execution of appropriate releases. Any
other settlement of such Claim, including, without limitation,
any settlement involving non-monetary consideration or admissions
of wrongdoing, shall not be settled without the prior written
consent of the Indemnified Party, which consent shall not be
unreasonably withheld.
(c) If the Indemnifying Party does not acknowledge its
indemnification obligations or elects not to defend a Claim, the
remaining provisions of this subsection (c) shall apply. The
Indemnified Party shall have the right to defend such Claim and
to settle such Claim on terms and conditions reasonably
acceptable to the Indemnified Party. If the Indemnifying Party is
obligated to indemnify the Indemnified Party in respect of such
Claim under this Agreement, the Indemnifying Party shall have the
indemnity and reimbursement obligations provided elsewhere in
this Agreement.
9. Termination
9.1 This Agreement may be terminated by Glasser or Cistron if the Closing
shall not have been consummated on or before July ___, 1999.
9.2 In the event of termination of this Agreement pursuant to Section 9.1,
written notice thereof shall forthwith be given to Glasser or Cistron,
as the case may be, and this Agreement shall terminate without further
action by any of the parties hereto.
<PAGE>
10. Miscellaneous.
10.1 This Agreement will be binding upon and inure to the benefit of the
parties hereto and their respective successors and legal
representatives.
10.2 Cistron acknowledges and agrees that the Shares may bear an
appropriate restrictive legend to the effect that the Shares may not
be sold or transferred without registration or the availability of a
valid exemption from registration, and that an acceptable opinion of
counsel for the issuer may be required.
10.3 This Agreement constitutes the entire agreement among the parties
regarding the subject matter hereof. All prior or contemporaneous
agreements, proposals, understandings and communications among the
parties, whether oral or written related to the subject matter hereof
are superseded by and merged into this Agreement. This Agreement may
not be modified or amended except by a written instrument executed by
all the parties hereto.
10.4 If any provision of this Agreement is held to be invalid, illegal or
unenforceable for any reason or in any respect, it shall be adjusted
rather than voided, if possible, in order to achieve the intent of the
parties to this Agreement to the extent possible. In any event, all
other provisions of this Agreement shall be deemed valid, legal and
enforceable to the fullest extent possible.
10.5 All notices, consents and other communications hereunder will be
provided in writing and will be delivered personally, by registered or
certified mail (return receipt requested) or by facsimile, to the
parties at the respective addresses set forth below (or such other
address as may have been furnished by or on behalf of any party by
like notice).
If to Cistron:
Cistron Biotechnology, Inc.
10 Bloomfield Avenue
Pine Brook, New Jersey 07058
Attention: Chief Executive Officer
Fax: (973) 575-4854
with a copy to:
Epstein Becker & Green, P.C.
250 Park Avenue
New York, New York 10177
Attention: Seth I. Truwit, Esquire
Facsimile: (212) 661-0989
If to Glasser:
Dr. Harvey Wm. Glasser
c/o Western Property Holdings
2000 Powell Street, Suite 1650
Emeryville, California 94608
Fax: (510) 601-8631
<PAGE>
and with a copy to:
Wilmer, Cutler & Pickering
2445 M Street, N.W.
Washington, DC 20037
Attention: Philip D. Anker,Esquire
Fax: (410) 986-2828
Communications sent by facsimile will be deemed effectively served upon
dispatch, transmission confirmed. Communications sent by registered or certified
mail will be deemed effectively served seven (7) calendar days after mailing.
Communications delivered by hand or overnight couriers will be deemed effective
upon delivery.
10.6 In the event of litigation between the parties regarding this
Agreement, the losing party shall reimburse the prevailing party for
its reasonable costs and attorneys' fees.
10.7 No waiver by any party of a breach of any term, provision or
condition of this Agreement by the other party will constitute a
waiver of any succeeding breach of the same or any other provision
hereof. No such waiver will be valid unless executed in writing by
the party making the waiver.
10.8 This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Delaware, without giving
effect to the conflict of laws principles thereof. Each of the
parties hereto (a) consents to submit itself to the personal
jurisdiction of any federal court located in the State of Delaware or
any Delaware state court if a dispute arises out of this Agreement or
any of the transactions contemplated by this Agreement, and (b)
agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such
court.
10.9 This Agreement may be executed in any number of counterparts, each of
which will be deemed an original and all of which taken together will
constitute one and the same document.
10.10 Nothing expressed or implied herein is intended, or shall be
construed, to confer upon or give any person or entity other than
Cistron and Glasser, any rights or remedies under or by reason of
this Agreement; provided, however, that the Estate is an intended
third-party beneficiary under Section 7.3.
10.11 The parties agree that time is of the essence.
10.12 THE PARTIES HERETO AGREE TO WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL
BY JURY OF ANY ISSUES RAISED IN ANY ACTION ALLEGING A BREACH OF THIS
AGREEMENT.
10.13 The captions and headings contained in this Agreement are for
reference purposes only and are not part of this Agreement.
[Signature page follows]
<PAGE>
PURCHASE AGREEMENT SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
CISTRON BIOTECHNOLOGY, INC.
By: /s/ Franklin J. Iris
- --------------------------------------
Name: Franklin J. Iris
Title: Chairman and CEO
DR. HARVEY WM. GLASSER
/s/ Harvey Wm. Glasser, MD
- --------------------------------------
