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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: October 7, 1996
INVITRO INTERNATIONAL
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(Exact name of registrant as specified in its charter)
California 0-19241 33-0149560
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation File No.) Identification No.)
or organization)
16632 Millikan Avenue, Irvine, California 92606
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(714) 851-8356
(Not Applicable)
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(Former name or former address, if changed since last report)
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INVITRO INTERNATIONAL
ITEM 5. OTHER EVENTS
On October 7, 1996, InVitro International (the "Company") received
$250,000 in gross proceeds from the sale of 799,935 shares of the Company's
common stock (the "Offering") in an offshore private placement under
Regulation S of the Securities Act of 1933. Shares were sold in the Offering
to two corporate entities, each of which was an accredited investor, under
agreements signed on September 30, 1996. The purchase price for shares of
the Company's common stock of $0.312525 per share represented a negotiated
discount of approximately 50% from the market price for the Company's common
stock of $0.625 per share on September 29, 1996. The Company incurred fees
payable to a placement agent, World Capital Funding, Incorporated, in the
aggregate amount of $25,000, resulting in net proceeds to the Company of
$225,000. The Offering was terminated by the Company on September 30, 1996
and all funds were received on or before October 7, 1996.
After giving effect to these transactions, the issued and outstanding
shares of the Company's common stock at the date of this Report is 14,038,300
shares.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) EXHIBITS:
<TABLE>
<CAPTION>
Exhibit
Number Description
<S> <C>
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10.42 Regulation S Offshore Transaction Subscription Agreement dated
September 30, 1996 between the Registrant and Wahoo International
Corporation.
10.43 Regulation S Offshore Transaction Subscription Agreement dated
September 30, 1996 between the Registrant and Settondown Capital
International, Inc.
</TABLE>
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: October 17, 1996
INVITRO INTERNATIONAL
(Registrant)
By: /s/ W. RICHARD ULMER
-----------------------------
W. Richard Ulmer,
President and Chief Executive Officer
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RevS-96c1
INVITRO INTERNATIONAL
(a California corporation)
REGULATION S OFFSHORE TRANSACTION SUBSCRIPTION AGREEMENT
Shares of Common Stock -- $250,000 Total Offering
Any interest in the Common Stock offered hereunder may be resold within the
jurisdiction of the United States or to U.S. Persons [as defined in Rule
902(o) of Regulation S under the United States Securities Act of 1933
("Securities Act")] by or for the account of the undersigned Foreign Investor
only: (i) pursuant to a registration statement under the Securities Act; or
(ii) pursuant to an applicable exemption, if any, from such registration. The
resale of these securities under Rule 903 of Regulation S and other
regulations under the Securities Act, if applicable, is prohibited before the
expiration of any restricted period required by Rule 903 of Regulation S.
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<TABLE>
<S> <C>
INVITRO INTERNATIONAL cc: William M. Curtis, Escrow Agent
16632 Millikan Avenue 25241 Buckskin Drive
Irvine, California 92606 Laguna Hills, California 92653-5736
Attention: W. Richard Ulmer FAX No. (714) 831-4141
FAX No. (714) 851-4985
</TABLE>
1. SUBSCRIPTION TO COMMON STOCK. The undersigned, an individual not
residing in the United States or a company organized under the laws of the
jurisdiction of its organization set forth on the signature page hereof
(herein called the "Foreign Investor"), hereby subscribes for the purchase of
the number of shares (the "Shares") of common stock, without par value (the
"Common Stock") in InVitro International, a California corporation ("INVITRO")
indicated on the signature page hereof upon the terms and conditions set forth
in this Subscription Agreement.
The subscription price for each share of INVITRO Common Stock
offered hereby shall be a 44.44% discount to the public market price per share
as quoted in the Nasdaq SmallCap Market on the date of this Subscription
Agreement, payable in U.S. funds by wire-transfer upon acceptance hereof.
The Foreign Investor shall pay the purchase price by delivering immediately
available funds in United States Dollars by wire-transfer to the attorney
trust account of INVITRO's counsel, as follows:
ABA ROUTING NUMBER [NUMBER INSERTED]
ORANGE NATIONAL BANK
[ADDRESS OF BANK]
[TELEPHONE NUMBER OF BANK]
[ACCOUNT NUMBER OF TRUST ACCOUNT]
Certificates evidencing the Common Stock purchased shall be delivered to the
Foreign Investor within five business days after completion of this Offering.
Regulation S Subscription Agreement - 1 -
<PAGE> 2
Concurrent with the completion of this Offering, the Company's corporate
counsel shall render an opinion to the Company's transfer agent as to (i) a
favorable opinion that the Shares of Common Stock are exempt from the prior
registration of such Shares under the Securities Act at the time of original
issuance as a private placement "offshore transaction" in compliance with the
exemption from registration provided by Rule 901 of Regulation S; and (ii) in
reliance upon the representation and warranties of the Foreign Purchaser and
the Company herein, a favorable opinion that resale of the Shares after the
expiration of the restricted period provided by Rule 903 of Regulation S will
be exempt from the prior registration thereof under the Securities Act as a
transaction or transactions by a person other than an issuer, underwriter or
dealer exempt under the provisions of Section 4(1) of the Securities Act in
accordance with safe harbor provisions of Section 903(c)(2)(iii) of Regulation
S applicable to securities of a Reporting Issuer.
2. DESCRIPTION OF OFFERING. INVITRO is offering shares of INVITRO
Common Stock for up to $250,000 in total amount U.S. funds on a "best efforts"
basis to a limited number of qualified investors in a private placement
offering of securities exempt from the registration requirements of the United
States Securities Act of 1933, as amended (the "Securities Act"). The entire
offering will be made only to parties who are not U.S. Persons as defined in
Rule 902(o) of Regulation S ("Regulation S") promulgated under the Securities
Act, and is herein called the "Offering".
All of the Shares offered to Foreign Investors are being offered
at a price per share equal to a 44.44% discount to the public market price per
share as quoted in the Nasdaq SmallCap Market on the date this Subscription
Agreement is accepted by INVITRO. There are no minimum amount of
subscriptions required in order for INVITRO to accept any subscriptions to the
Offering. The Offering will terminate on September 30, 1996 unless extended
at the option of INVITRO for an additional period of not more than 30 days.
INVITRO reserves the right to terminate the Offering at any time, whether or
not the maximum Shares have been sold.
3. REPRESENTATIONS AND WARRANTIES OF THE FOREIGN INVESTOR. In
connection with this Agreement and the transactions contemplated herein, the
Foreign Investor represents and warrants to INVITRO as follows:
3.1. The Foreign Investor either (i) has been duly formed and is
validly existing as a corporation or other legal entity in good standing under
the laws of its jurisdiction of incorporation set forth on the signature page
to this Agreement or (ii) is an individual not a citizen or resident of the
United States. The Foreign Investor is not organized under the laws of the
United States, is not a "U.S. Person" as that term is defined in Rule 902(o)
of Regulation S, and is not an "affiliate" of INVITRO as that term is used in
regulations promulgated under the Securities Act, nor associated with any
individual or entity which may be deemed an "affiliate" of INVITRO as of the
date hereof.
3.2. The Foreign Investor was not formed for the purpose of investing
in Regulation S securities or formed for the purpose of investing in this
Agreement and the Shares of INVITRO. The Foreign Investor is not registered
as an issuer under the Securities Act and is not required to be registered
with the U.S. Securities and Exchange Commission under the Investment Company
Act of 1940, as amended. The Foreign Investor is neither a broker nor a
dealer in securities within the meaning of the Securities Act, and is entering
into this Agreement and is participating in the Offering for its own account
for investment, and not on behalf of any U.S. Person as defined in Rule 902(o)
of Regulation S.
Regulation S Subscription Agreement - 2 -
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3.3. No offer to enter into this Agreement has been made by INVITRO to
the Foreign Investor in the United States other than as permitted in the case
of an account managed by a professional fiduciary resident in the United
States within the meaning of Section 902(o)(2) of Regulation S. At the times
of the offer and execution of this Agreement and, to the best knowledge of the
Foreign Investor, at the time the Offering originated, the Foreign Investor
was located and resident outside the United States other than as permitted in
the case of an account managed by a professional fiduciary resident in the
United States within the meaning of Section 902(o)(2) of Regulation S.
3.4. From the date the Foreign Investor was first advised of this
Offering through the expiration of any restricted period set forth in Rule 903
of Regulation S, neither the Foreign Investor nor any of its affiliates, nor
any person acting on its behalf or any behalf of any such affiliates, has
engaged or will engage in any "Directed Selling Effort" within the meaning of
Rule 902 of Regulation S. Specifically, neither the Foreign Investor nor any
such affiliate has engaged in, nor will any such person engage in, any
activity during the restricted period undertaken for the purpose of, or that
could reasonably be expected to have the effect of, promoting or soliciting
the purchase of INVITRO Common Stock by any third party or otherwise
conditioning the markets in the United States for the Shares or for any
securities that are convertible into or exercisable for the Common Stock of
INVITRO.
The Foreign Investor has not, and prior to the expiration of any
restricted period contained in Regulation S will not, directly or indirectly,
hedge the risk of its investment in the Shares by any means including, but not
limited to, effecting any sale or short sale of INVITRO securities in the
United States markets directly or indirectly for the account of the Foreign
Investor or any of its affiliates.
To the best knowledge of the Foreign Investor, this Agreement and
the transactions contemplated herein are not part of a plan or scheme to evade
the registration provisions of the Securities Act, and the Foreign Investor
represents and warrants that the Shares are being purchased solely for
investment purposes for the Foreign Investor's own account. The Foreign
Investor has agreed that all offers and sales of any securities included in
the Offering prior to the date hereof and through the expiration of any
restricted period set forth in Rule 903 of Regulation S (as the same may be
amended from time to time hereafter) shall not be made to U.S. Persons or for
the account or benefit of U.S. Persons, and shall otherwise be made in
compliance with the provisions of Regulation S and any other applicable
provisions of the Securities Act, if applicable to any such transaction.
3.5. The Foreign Investor acknowledges and agrees that following the
expiration of any restricted period provided by Rule 903 of Regulation S, any
interest in this Agreement or in the Shares subscribed to hereunder may be
resold within the jurisdiction of the United States or to U.S. Persons [as
defined in Rule 902(o) of Regulation S] by or for the account of the parties
hereto only: (i) pursuant to a registration statement under the Securities
Act, or (ii) if applicable, pursuant to an exemption from such registration
for sales by a person other than an issuer, underwriter or dealer as those
terms are used in Section 4(1) and related provisions of the Securities Act
and regulations thereunder, or pursuant to another exemption from
registration, and only following the expiration of any restricted period (if
applicable) required by Regulation S. The Foreign Investor acknowledges that
this Agreement and the INVITRO Shares have not been registered under the
Securities Act or qualified under state securities laws of the United States,
and that the transferability hereof and thereof within the jurisdiction of the
United States is restricted by the Securities Act as well as such state laws.
The Foreign Investor acknowledges that this Agreement and the Shares are being
sold
Regulation S Subscription Agreement - 3 -
<PAGE> 4
in reliance upon the transaction exemption afforded by Regulation S in
connection with an offshore offer and sale of securities of INVITRO not within
or subject to the jurisdiction of the United States markets. The Foreign
Investor acknowledges it has received a copy of Regulation S, is familiar with
and understands the terms thereof, and has had the opportunity to consult with
its legal counsel concerning this Agreement and Regulation S.
The Foreign Investor acknowledges that if any transfer of the
Shares is proposed to be made in reliance upon an exemption under the
Securities Act, the issuer of the securities may require an opinion of counsel
satisfactory to the issuer that such transfer may be made pursuant to an
applicable exemption under the Securities Act. The Foreign Investor
acknowledges that, so long as appropriate, a legend similar to the following
may appear on the certificates representing the INVITRO Shares subscribed for
hereunder:
"These shares have been issued pursuant to an exemption from
registration under the Securities Act of 1933, as amended,
pursuant to Regulation S thereunder. The shares evidenced by this
certificate cannot be transferred, offered or sold in the United
States or to U.S. Persons (as that term is defined in Regulation
S) until after ________ (41 days after completion of the
Offering)."
3.6. The Foreign Investor has not received any general solicitation or
advertising regarding the Offering or this Agreement. The Foreign Investor
has sufficient knowledge and experience in financial and business matters so
that it is able to evaluate the merits and risks of the Offering and this
Agreement. The Foreign Investor has had substantial experience in previous
private and public purchases of speculative and restricted securities.
3.7. The Foreign Investor acknowledges that an investment in the Shares
offered hereby is speculative, involves a high degree of risk, and should not
be purchased by persons who cannot afford the loss of their entire investment,
and represents that the Foreign Investor has relied only on the information
contained herein or otherwise provided in writing by duly authorized
representatives of INVITRO. The Foreign Investor has carefully read and
reviewed this Subscription Agreement and all of INVITRO's filings with the
Securities and Exchange Commission incorporated by reference herein
(including, without limitation, the section entitled "Cautionary Statements
for Purposes of the 'Safe Harbor' Provisions of the Private Securities
Litigation Reform Act of 1995" in INVITRO's Report on Form 10-QSB for the
Period ended March 31, 1996), and has asked such questions of management of
INVITRO and received such additional information as he, she or it deems
necessary in order for the Foreign Investor to make an informed decision with
respect to the purchase of the Shares. The Foreign Investor has received
complete and satisfactory answers to all such inquiries. The Foreign Investor
has not received oral or written representations or assurances from INVITRO or
any representatives of INVITRO, other than as set forth in this Agreement and
the reports filed by INVITRO with the Securities and Exchange Commission.
3.8. This Agreement has been duly authorized, executed and delivered by
the Foreign Investor and is a valid and binding agreement enforceable in
accordance with its terms, subject only to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general application
to or affecting creditors' rights generally and to general principles of
equity. The Foreign Investor has full power and authority necessary to enter
into this Agreement and to perform its obligations hereunder.
Regulation S Subscription Agreement - 4 -
<PAGE> 5
3.9. The execution and delivery of this Agreement, and the consummation
of the transactions contemplated herein, do not and will not conflict with or
result in a breach by the Foreign Investor of any of the terms or provisions
of, or constitute a default under, its charter documents, its memorandum or
articles of association or incorporation, its by-laws, any action of its
directors or shareholders, or any indenture, mortgage, deed of trust or other
agreement or instrument to which the undersigned is a party or by which it or
any of its properties or assets are bound, or any existing applicable law,
rule or regulation or any applicable decree, judgment or order of any court,
regulatory body, administrative agency or other governmental body having
jurisdiction over the undersigned or any of its properties or assets.
4. REPRESENTATIONS AND WARRANTIES OF INVITRO. By its acceptance of any
subscription from the Foreign Investor hereunder, INVITRO represents and
warrant to the Foreign Investor as follows:
4.1. INVITRO is duly organized and validly existing in good standing
as a corporation under the laws of California with corporate power to enter
into this Agreement and to conduct its business as presently conducted.
4.2. INVITRO is a "Reporting Issuer" as defined in Rule 902(l) of
Regulation S and will cause all the materials required to be filed by it
pursuant to Section 13(a) of the U.S. Securities Exchange Act of 1934, as
amended (the "Exchange Act") to be filed with the Securities and Exchange
Commission for a period of at least three (3) months following the completion
of the Offering. INVITRO is not an investment company registered or required
to register as such under the United States Investment Company Act of 1940.
4.3. The Common Stock of INVITRO is a class of securities registered
under Section 12(g) of the Exchange Act, and INVITRO has filed all reports and
documents required to be filed pursuant to the Exchange Act for a period of at
least twelve months preceding the date hereof. All documents filed by INVITRO
with the Securities and Exchange Commission pursuant to the Exchange Act for
its most recent full fiscal year and subsequent thereto are incorporated by
reference in this Agreement, including: (i) INVITRO's Annual Report on Form
10-K for the fiscal year ended September 30, 1995; (ii) INVITRO's Quarterly
Reports on Form 10-QSB for the periods ended December 31, 1995, March 31, 1996
and June 30, 1996; (iii) INVITRO's Current Reports on Form 8-K dated as of
September 11, 1995, May 16, 1996 and June 18, 1996; and (iv) INVITRO's proxy
statement dated November 30, 1995 for its 1996 Annual Meeting of Shareholders.
4.4. INVITRO agrees to make available to the Foreign Investor, prior
to this subscription, the opportunity to ask questions of, and receive written
answers from, authorized representatives of INVITRO concerning the terms and
conditions of this Offering, the operations of INVITRO and any affiliated
companies and any other relevant matters, and to obtain any additional written
information, to the extent that the INVITRO possesses such information or can
acquire it without unreasonable effort or expense, necessary to verify the
accuracy of the information furnished to the Foreign Investor in connection
with this Offering.
4.5. INVITRO has not offered any securities covered by this Offering
to any persons in the United States nor to any U.S. Person nor to any
identifiable group or groups of U.S. citizens in the United States or abroad.
Regulation S Subscription Agreement - 5 -
<PAGE> 6
4.6. The INVITRO Shares, when issued and delivered upon payment of the
subscription price, will each be duly and validly authorized and issued, fully
paid and nonassessable securities of INVITRO and will not subject the holders
thereof to personal liability by reason of being such holders.
4.7. This Agreement, upon its acceptance by INVITRO, has been duly
authorized, executed and delivered by INVITRO and is a valid and binding
agreement enforceable in accordance with its terms, subject only to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general application to or affecting creditors' rights
generally and to general principles of equity. INVITRO has full power and
authority necessary to enter into this Agreement and to perform its
obligations hereunder.
4.8. The execution and delivery of this Agreement, and the
consummation of the transactions contemplated herein, do not and will not
conflict with or result in a breach by INVITRO of any of the terms or
provisions of, or constitute a default under, its articles of incorporation or
association, its by-laws, any action of its directors or shareholders, or any
indenture, mortgage, deed of trust or other agreement or instrument to which
it is a party or by which it or any of its properties or assets are bound, or
any existing applicable law, rule or regulation or any applicable decree,
judgment or order of any court, regulatory body, administrative agency or
other governmental body having jurisdiction over the undersigned or any of its
properties or assets.
5. OTHER TERMS AND AGREEMENTS.
5.1. Each of the parties understand that no governmental agency of any
jurisdiction has passed upon or made any recommendation or endorsement of the
Shares, the transactions contemplated by this Agreement, or an investment in
the Shares.
5.2. Each of the undersigned agrees to pay its own expenses incident to
the performance of its obligations hereunder.
5.3. Each of the undersigned agree this Agreement shall be governed by
and construed in accordance with the laws of the State of California, and
without regard to principles of conflicts of law.
5.4. This Agreement may be executed in one or more counterparts and it
is not necessary that the signatures of all parties appear on the same
counterpart, but such counterparts together shall constitute but one and the
same agreement. The headings of the sections of this Agreement have been
inserted for convenience of reference only, and shall not be deemed to be a
part of this Agreement.
5.5. Time shall be of the essence of this Agreement.
Regulation S Subscription Agreement - 6 -
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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
as of the respective dates set forth below.
NUMBER OF INVITRO SHARES SUBSCRIBED FOR:
639,948 Shares at $0.312525 per Share equals $ 200,000 (U.S. funds).
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Date: September 30, 1996
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FOREIGN INVESTOR:
WAHOO INTERNATIONAL CORPORATION
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[Full Legal Name -- PLEASE PRINT]
By: /s/ Robert E. Cordes
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[Authorised Signature]
Principal Address of Foreign Investor: Citibank Bldg., Box F 42544
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Freeport, Bahamas
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IF A COMPANY:
Name of Signing Officer: Robert E. Cordes
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Title of Signing Officer: President
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Jurisdiction in which Foreign Investor is Incorporated or Organized:
Island of Nevis
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~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
This Agreement is accepted as of 9-30- , 1996
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for INVITRO INTERNATIONAL:
By: /s/ W. Richard Ulmer
------------------------------------
[Authorized Signature]
Name and Title of Signing Officer: W. RICHARD ULMER, President
RevS-96c1
Regulation S Subscription Agreement - 7 -
<PAGE> 1
RevS-96c1
INVITRO INTERNATIONAL
(a California corporation)
REGULATION S OFFSHORE TRANSACTION SUBSCRIPTION AGREEMENT
Shares of Common Stock -- $250,000 Total Offering
Any interest in the Common Stock offered hereunder may be resold within the
jurisdiction of the United States or to U.S. Persons [as defined in Rule
902(o) of Regulation S under the United States Securities Act of 1933
("Securities Act")] by or for the account of the undersigned Foreign Investor
only: (i) pursuant to a registration statement under the Securities Act; or
(ii) pursuant to an applicable exemption, if any, from such registration. The
resale of these securities under Rule 903 of Regulation S and other
regulations under the Securities Act, if applicable, is prohibited before the
expiration of any restricted period required by Rule 903 of Regulation S.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
<TABLE>
<S> <C>
INVITRO INTERNATIONAL cc: William M. Curtis, Escrow Agent
16632 Millikan Avenue 25241 Buckskin Drive
Irvine, California 92606 Laguna Hills, California 92653-5736
Attention: W. Richard Ulmer FAX No. (714) 831-4141
FAX No. (714) 851-4985
</TABLE>
1. SUBSCRIPTION TO COMMON STOCK. The undersigned, an individual not
residing in the United States or a company organized under the laws of the
jurisdiction of its organization set forth on the signature page hereof
(herein called the "Foreign Investor"), hereby subscribes for the purchase of
the number of shares (the "Shares") of common stock, without par value (the
"Common Stock") in InVitro International, a California corporation ("INVITRO")
indicated on the signature page hereof upon the terms and conditions set forth
in this Subscription Agreement.
The subscription price for each share of INVITRO Common Stock
offered hereby shall be a 44.44% discount to the public market price per share
as quoted in the Nasdaq SmallCap Market on the date of this Subscription
Agreement, payable in U.S. funds by wire-transfer upon acceptance hereof.
The Foreign Investor shall pay the purchase price by delivering immediately
available funds in United States Dollars by wire-transfer to the attorney
trust account of INVITRO's counsel, as follows:
ABA ROUTING NUMBER [NUMBER INSERTED]
ORANGE NATIONAL BANK
[ADDRESS OF BANK]
[TELEPHONE NUMBER OF BANK]
[ACCOUNT NUMBER OF TRUST ACCOUNT]
Certificates evidencing the Common Stock purchased shall be delivered to the
Foreign Investor within five business days after completion of this Offering.
Regulation S Subscription Agreement - 1 -
<PAGE> 2
Concurrent with the completion of this Offering, the Company's corporate
counsel shall render an opinion to the Company's transfer agent as to (i) a
favorable opinion that the Shares of Common Stock are exempt from the prior
registration of such Shares under the Securities Act at the time of original
issuance as a private placement "offshore transaction" in compliance with the
exemption from registration provided by Rule 901 of Regulation S; and (ii) in
reliance upon the representation and warranties of the Foreign Purchaser and
the Company herein, a favorable opinion that resale of the Shares after the
expiration of the restricted period provided by Rule 903 of Regulation S will
be exempt from the prior registration thereof under the Securities Act as a
transaction or transactions by a person other than an issuer, underwriter or
dealer exempt under the provisions of Section 4(1) of the Securities Act in
accordance with safe harbor provisions of Section 903(c)(2)(iii) of Regulation
S applicable to securities of a Reporting Issuer.
2. DESCRIPTION OF OFFERING. INVITRO is offering shares of INVITRO
Common Stock for up to $250,000 in total amount U.S. funds on a "best efforts"
basis to a limited number of qualified investors in a private placement
offering of securities exempt from the registration requirements of the United
States Securities Act of 1933, as amended (the "Securities Act"). The entire
offering will be made only to parties who are not U.S. Persons as defined in
Rule 902(o) of Regulation S ("Regulation S") promulgated under the Securities
Act, and is herein called the "Offering".
All of the Shares offered to Foreign Investors are being offered
at a price per share equal to a 44.44% discount to the public market price per
share as quoted in the Nasdaq SmallCap Market on the date this Subscription
Agreement is accepted by INVITRO. There are no minimum amount of
subscriptions required in order for INVITRO to accept any subscriptions to the
Offering. The Offering will terminate on September 30, 1996 unless extended
at the option of INVITRO for an additional period of not more than 30 days.
INVITRO reserves the right to terminate the Offering at any time, whether or
not the maximum Shares have been sold.
3. REPRESENTATIONS AND WARRANTIES OF THE FOREIGN INVESTOR. In
connection with this Agreement and the transactions contemplated herein, the
Foreign Investor represents and warrants to INVITRO as follows:
3.1. The Foreign Investor either (i) has been duly formed and is
validly existing as a corporation or other legal entity in good standing under
the laws of its jurisdiction of incorporation set forth on the signature page
to this Agreement or (ii) is an individual not a citizen or resident of the
United States. The Foreign Investor is not organized under the laws of the
United States, is not a "U.S. Person" as that term is defined in Rule 902(o)
of Regulation S, and is not an "affiliate" of INVITRO as that term is used in
regulations promulgated under the Securities Act, nor associated with any
individual or entity which may be deemed an "affiliate" of INVITRO as of the
date hereof.
3.2. The Foreign Investor was not formed for the purpose of investing
in Regulation S securities or formed for the purpose of investing in this
Agreement and the Shares of INVITRO. The Foreign Investor is not registered
as an issuer under the Securities Act and is not required to be registered
with the U.S. Securities and Exchange Commission under the Investment Company
Act of 1940, as amended. The Foreign Investor is neither a broker nor a
dealer in securities within the meaning of the Securities Act, and is entering
into this Agreement and is participating in the Offering for its own account
for investment, and not on behalf of any U.S. Person as defined in Rule 902(o)
of Regulation S.
Regulation S Subscription Agreement - 2 -
<PAGE> 3
3.3. No offer to enter into this Agreement has been made by INVITRO to
the Foreign Investor in the United States other than as permitted in the case
of an account managed by a professional fiduciary resident in the United
States within the meaning of Section 902(o)(2) of Regulation S. At the times
of the offer and execution of this Agreement and, to the best knowledge of the
Foreign Investor, at the time the Offering originated, the Foreign Investor
was located and resident outside the United States other than as permitted in
the case of an account managed by a professional fiduciary resident in the
United States within the meaning of Section 902(o)(2) of Regulation S.
3.4. From the date the Foreign Investor was first advised of this
Offering through the expiration of any restricted period set forth in Rule 903
of Regulation S, neither the Foreign Investor nor any of its affiliates, nor
any person acting on its behalf or any behalf of any such affiliates, has
engaged or will engage in any "Directed Selling Effort" within the meaning of
Rule 902 of Regulation S. Specifically, neither the Foreign Investor nor any
such affiliate has engaged in, nor will any such person engage in, any
activity during the restricted period undertaken for the purpose of, or that
could reasonably be expected to have the effect of, promoting or soliciting
the purchase of INVITRO Common Stock by any third party or otherwise
conditioning the markets in the United States for the Shares or for any
securities that are convertible into or exercisable for the Common Stock of
INVITRO.
The Foreign Investor has not, and prior to the expiration of any
restricted period contained in Regulation S will not, directly or indirectly,
hedge the risk of its investment in the Shares by any means including, but not
limited to, effecting any sale or short sale of INVITRO securities in the
United States markets directly or indirectly for the account of the Foreign
Investor or any of its affiliates.
To the best knowledge of the Foreign Investor, this Agreement and
the transactions contemplated herein are not part of a plan or scheme to evade
the registration provisions of the Securities Act, and the Foreign Investor
represents and warrants that the Shares are being purchased solely for
investment purposes for the Foreign Investor's own account. The Foreign
Investor has agreed that all offers and sales of any securities included in
the Offering prior to the date hereof and through the expiration of any
restricted period set forth in Rule 903 of Regulation S (as the same may be
amended from time to time hereafter) shall not be made to U.S. Persons or for
the account or benefit of U.S. Persons, and shall otherwise be made in
compliance with the provisions of Regulation S and any other applicable
provisions of the Securities Act, if applicable to any such transaction.
3.5. The Foreign Investor acknowledges and agrees that following the
expiration of any restricted period provided by Rule 903 of Regulation S, any
interest in this Agreement or in the Shares subscribed to hereunder may be
resold within the jurisdiction of the United States or to U.S. Persons [as
defined in Rule 902(o) of Regulation S] by or for the account of the parties
hereto only: (i) pursuant to a registration statement under the Securities
Act, or (ii) if applicable, pursuant to an exemption from such registration
for sales by a person other than an issuer, underwriter or dealer as those
terms are used in Section 4(1) and related provisions of the Securities Act
and regulations thereunder, or pursuant to another exemption from
registration, and only following the expiration of any restricted period (if
applicable) required by Regulation S. The Foreign Investor acknowledges that
this Agreement and the INVITRO Shares have not been registered under the
Securities Act or qualified under state securities laws of the United States,
and that the transferability hereof and thereof within the jurisdiction of the
United States is restricted by the Securities Act as well as such state laws.
The Foreign Investor acknowledges that this Agreement and the Shares are being
sold
Regulation S Subscription Agreement - 3 -
<PAGE> 4
in reliance upon the transaction exemption afforded by Regulation S in
connection with an offshore offer and sale of securities of INVITRO not within
or subject to the jurisdiction of the United States markets. The Foreign
Investor acknowledges it has received a copy of Regulation S, is familiar with
and understands the terms thereof, and has had the opportunity to consult with
its legal counsel concerning this Agreement and Regulation S.
The Foreign Investor acknowledges that if any transfer of the
Shares is proposed to be made in reliance upon an exemption under the
Securities Act, the issuer of the securities may require an opinion of counsel
satisfactory to the issuer that such transfer may be made pursuant to an
applicable exemption under the Securities Act. The Foreign Investor
acknowledges that, so long as appropriate, a legend similar to the following
may appear on the certificates representing the INVITRO Shares subscribed for
hereunder:
"These shares have been issued pursuant to an exemption from
registration under the Securities Act of 1933, as amended,
pursuant to Regulation S thereunder. The shares evidenced by this
certificate cannot be transferred, offered or sold in the United
States or to U.S. Persons (as that term is defined in Regulation
S) until after ________ (41 days after completion of the
Offering)."
3.6. The Foreign Investor has not received any general solicitation or
advertising regarding the Offering or this Agreement. The Foreign Investor
has sufficient knowledge and experience in financial and business matters so
that it is able to evaluate the merits and risks of the Offering and this
Agreement. The Foreign Investor has had substantial experience in previous
private and public purchases of speculative and restricted securities.
3.7. The Foreign Investor acknowledges that an investment in the Shares
offered hereby is speculative, involves a high degree of risk, and should not
be purchased by persons who cannot afford the loss of their entire investment,
and represents that the Foreign Investor has relied only on the information
contained herein or otherwise provided in writing by duly authorized
representatives of INVITRO. The Foreign Investor has carefully read and
reviewed this Subscription Agreement and all of INVITRO's filings with the
Securities and Exchange Commission incorporated by reference herein
(including, without limitation, the section entitled "Cautionary Statements
for Purposes of the 'Safe Harbor' Provisions of the Private Securities
Litigation Reform Act of 1995" in INVITRO's Report on Form 10-QSB for the
Period ended March 31, 1996), and has asked such questions of management of
INVITRO and received such additional information as he, she or it deems
necessary in order for the Foreign Investor to make an informed decision with
respect to the purchase of the Shares. The Foreign Investor has received
complete and satisfactory answers to all such inquiries. The Foreign Investor
has not received oral or written representations or assurances from INVITRO or
any representatives of INVITRO, other than as set forth in this Agreement and
the reports filed by INVITRO with the Securities and Exchange Commission.
3.8. This Agreement has been duly authorized, executed and delivered by
the Foreign Investor and is a valid and binding agreement enforceable in
accordance with its terms, subject only to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general application
to or affecting creditors' rights generally and to general principles of
equity. The Foreign Investor has full power and authority necessary to enter
into this Agreement and to perform its obligations hereunder.
Regulation S Subscription Agreement - 4 -
<PAGE> 5
3.9. The execution and delivery of this Agreement, and the consummation
of the transactions contemplated herein, do not and will not conflict with or
result in a breach by the Foreign Investor of any of the terms or provisions
of, or constitute a default under, its charter documents, its memorandum or
articles of association or incorporation, its by-laws, any action of its
directors or shareholders, or any indenture, mortgage, deed of trust or other
agreement or instrument to which the undersigned is a party or by which it or
any of its properties or assets are bound, or any existing applicable law,
rule or regulation or any applicable decree, judgment or order of any court,
regulatory body, administrative agency or other governmental body having
jurisdiction over the undersigned or any of its properties or assets.
4. REPRESENTATIONS AND WARRANTIES OF INVITRO. By its acceptance of any
subscription from the Foreign Investor hereunder, INVITRO represents and
warrant to the Foreign Investor as follows:
4.1. INVITRO is duly organized and validly existing in good standing
as a corporation under the laws of California with corporate power to enter
into this Agreement and to conduct its business as presently conducted.
4.2. INVITRO is a "Reporting Issuer" as defined in Rule 902(l) of
Regulation S and will cause all the materials required to be filed by it
pursuant to Section 13(a) of the U.S. Securities Exchange Act of 1934, as
amended (the "Exchange Act") to be filed with the Securities and Exchange
Commission for a period of at least three (3) months following the completion
of the Offering. INVITRO is not an investment company registered or required
to register as such under the United States Investment Company Act of 1940.
4.3. The Common Stock of INVITRO is a class of securities registered
under Section 12(g) of the Exchange Act, and INVITRO has filed all reports and
documents required to be filed pursuant to the Exchange Act for a period of at
least twelve months preceding the date hereof. All documents filed by INVITRO
with the Securities and Exchange Commission pursuant to the Exchange Act for
its most recent full fiscal year and subsequent thereto are incorporated by
reference in this Agreement, including: (i) INVITRO's Annual Report on Form
10-K for the fiscal year ended September 30, 1995; (ii) INVITRO's Quarterly
Reports on Form 10-QSB for the periods ended December 31, 1995, March 31, 1996
and June 30, 1996; (iii) INVITRO's Current Reports on Form 8-K dated as of
September 11, 1995, May 16, 1996 and June 18, 1996; and (iv) INVITRO's proxy
statement dated November 30, 1995 for its 1996 Annual Meeting of Shareholders.
4.4. INVITRO agrees to make available to the Foreign Investor, prior
to this subscription, the opportunity to ask questions of, and receive written
answers from, authorized representatives of INVITRO concerning the terms and
conditions of this Offering, the operations of INVITRO and any affiliated
companies and any other relevant matters, and to obtain any additional written
information, to the extent that the INVITRO possesses such information or can
acquire it without unreasonable effort or expense, necessary to verify the
accuracy of the information furnished to the Foreign Investor in connection
with this Offering.
4.5. INVITRO has not offered any securities covered by this Offering
to any persons in the United States nor to any U.S. Person nor to any
identifiable group or groups of U.S. citizens in the United States or abroad.
Regulation S Subscription Agreement - 5 -
<PAGE> 6
4.6. The INVITRO Shares, when issued and delivered upon payment of the
subscription price, will each be duly and validly authorized and issued, fully
paid and nonassessable securities of INVITRO and will not subject the holders
thereof to personal liability by reason of being such holders.
4.7. This Agreement, upon its acceptance by INVITRO, has been duly
authorized, executed and delivered by INVITRO and is a valid and binding
agreement enforceable in accordance with its terms, subject only to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general application to or affecting creditors' rights
generally and to general principles of equity. INVITRO has full power and
authority necessary to enter into this Agreement and to perform its
obligations hereunder.
4.8. The execution and delivery of this Agreement, and the
consummation of the transactions contemplated herein, do not and will not
conflict with or result in a breach by INVITRO of any of the terms or
provisions of, or constitute a default under, its articles of incorporation or
association, its by-laws, any action of its directors or shareholders, or any
indenture, mortgage, deed of trust or other agreement or instrument to which
it is a party or by which it or any of its properties or assets are bound, or
any existing applicable law, rule or regulation or any applicable decree,
judgment or order of any court, regulatory body, administrative agency or
other governmental body having jurisdiction over the undersigned or any of its
properties or assets.
5. OTHER TERMS AND AGREEMENTS.
5.1. Each of the parties understand that no governmental agency of any
jurisdiction has passed upon or made any recommendation or endorsement of the
Shares, the transactions contemplated by this Agreement, or an investment in
the Shares.
5.2. Each of the undersigned agrees to pay its own expenses incident to
the performance of its obligations hereunder.
5.3. Each of the undersigned agree this Agreement shall be governed by
and construed in accordance with the laws of the State of California, and
without regard to principles of conflicts of law.
5.4. This Agreement may be executed in one or more counterparts and it
is not necessary that the signatures of all parties appear on the same
counterpart, but such counterparts together shall constitute but one and the
same agreement. The headings of the sections of this Agreement have been
inserted for convenience of reference only, and shall not be deemed to be a
part of this Agreement.
5.5. Time shall be of the essence of this Agreement.
Regulation S Subscription Agreement - 6 -
<PAGE> 7
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
as of the respective dates set forth below.
NUMBER OF INVITRO SHARES SUBSCRIBED FOR:
159,987 Shares at $0.312525 per Share equals $ 50,000 (U.S. funds).
- -------- --------- ---------
Date: September 30, 1996
-------------
FOREIGN INVESTOR:
SETTONDOWN CAPITAL INTERNATIONAL LTD.
- -----------------------------------------------------------------------------
[Full Legal Name -- PLEASE PRINT]
By: /s/ Anthony L. M. Inder Rieden
--------------------------------------------------------------------------
[Authorised Signature]
Principal Address of Foreign Investor: CHARLOTTE HOUSE, CHARLOTTE STREET
-------------------------------------
P.O. BOX N-9204
-------------------------------------
NASSAU, BAHAMAS
-------------------------------------
IF A COMPANY:
Name of Signing Officer: ANTHONY L. M. INDER RIEDEN
-------------------------------------
Title of Signing Officer: DIRECTOR
-------------------------------------
Jurisdiction in which Foreign Investor is Incorporated or Organized:
BAHAMAS
-------------------------------------
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
This Agreement is accepted as of 9-30- , 1996
-----------
for INVITRO INTERNATIONAL:
By: /s/ W. Richard Ulmer
------------------------------------
[Authorized Signature]
Name and Title of Signing Officer: W. RICHARD ULMER, President
RevS-96c1
Regulation S Subscription Agreement - 7 -
