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EXHIBIT 4.4.a
March 31, 1997
Connecticut Development Authority
845 Brook Street
Rocky Hill, CT 06067
Re: Modification and Conversion of Note and Related Matters
Gentlemen:
This letter will evidence the agreement of Bio-Plexus, Inc. ("BP") and
the Connecticut Development Authority ("CDA") regarding the modification and
conversion of a certain note held by CDA and related matters.
On March 7, 1995 CDA and BP entered into a financing transaction
pursuant to which CDA advanced BP $2.5 million and BP issued CDA a note in that
principal amount (the "Note). The principal amount of the Note has been paid
down to $2,121,410 as of the date of this letter agreement.
BP desires to repay a portion of the Note and CDA desires to convert
the unpaid balance of the Note into shares of BP common stock, without par value
("Shares").
In consideration of the mutual and dependent promises set forth
herein, BP and CDA agree as follows:
1. Modification of Note
The Note is hereby amended to provide for it to be
convertible into Shares in accordance with this letter agreement.
2. Repayment of the Note
Upon entering into this letter agreement, BP will pay
$1,050,000 against the principal amount of the Note and CDA will
release all liens against the assets of BP related to the Note.
3. Conversion of Balance of Note
Upon entering into this letter agreement, CDA will convert the
remaining balance of the Note, including interest through March
31,1997, ($1,087,320.81) into 241,627 Shares at $4.50 per Share. The
Note will be surrendered to BP by CDA and BP will issue CDA
certificates for such Shares.
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March 31, 1997
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4. Sale of Shares
Subsequent to the conversion of the Note CDA may hold or sell
the CDA Shares. Any sale of more than an average of 1,000 Shares per
trading day will require the consent of BP, which consent will not be
unreasonably withheld. The sole concern of BP with respect to any such
sale is to minimize the adverse impact of such a sale upon the public
market for the Shares. However, in no event will CDA be required by
this paragraph to hold any Shares beyond March 31, 1998.
5. Redemption of CDA Shares
BP will redeem Shares issued hereunder and held by CDA upon
the following terms and conditions:
i. If CDA has received net aggregate proceeds
from the sale of Shares equal to $1,125,000,
BP will redeem all remaining Shares issued
to CDA hereunder at a price of one cent per
Share. CDA shall notify BP if such event
occurs and BP shall promptly redeem the
remaining Shares.
ii. If by March 31, 1998, CDA has not received
net aggregate proceeds of $1,125,000 from
the sale of Shares issued hereunder and CDA
still holds some Shares, BP will redeem all
such remaining Shares for an aggregate
redemption price equal to the difference
between $1,125,000 and the amount received
by CDA for the sale of all Shares issued
hereunder other than said remaining Shares.
iii. Redemption payments shall be made in cash.
6. Representations and Warrants of BP
BP represents and warrants to CDA as follows:
a. BP has all requisite corporate power and authority to
enter into this Letter Agreement and to issue and
sell the Shares. The issuance and sale of the shares
by BP to CDA has been duly and validly authorized by
all requisite corporate proceeding on the part of BP
and do not constitute or will not result in: (i) a
conflict, default or violation of or under the
Certificate of Incorporation or By-laws of BP; (ii) a
default or violation under any mortgage, note, lease
agreement or other instrument or obligation to which
BP is a party; or (iii) a violation of any statute,
rule, regulation, order, judgment or decree of any
court, public body or authority with jurisdiction
over BP; or (iv)
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March 31, 1997
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creation of imposition of any lien, charge or
encumbrance of any property of BP; or (v) an event
which would require any consent from any third party
which has not been obtained.
b. Upon the issuance and delivery of the shares to CDA,
all of such Shares shall have been duly authorized
and validly issued and fully paid and nonassessable,
subject to no grant of rights, liens, or other
rights, claims or options.
c. BP has the requisite corporate power and authority to
execute, deliver and perform its obligations under
this letter agreement. The execution and delivery of
this agreement and BP's performance of its
obligations hereunder have been duly and validly
authorized by BP and this agreement, as executed and
delivered, will constitute a valid and binding
obligation of BP enforceable against BP in accordance
with its terms.
d. Immediately prior to the issuance of the Shares,
7,517,869 shares of BP are authorized, issued and
outstanding. The average daily trading volume of the
Shares for each full week of March, 1997 was 30,840,
29,880, 58,660, and 5,940, respectively; and for each
such week the average trading price per Share was
$5.95, $5.55, $5.03 and $5.30.
e. The Shares are currently listed and traded on the
NASDAQ Small Capital Market (the "Exchange"). BP is a
reporting company under the Securities and Exchange
Act of 1934 (the "Act"), and is current in the filing
of all information and reports required thereunder.
BP has no plans to discontinue such listing or
trading.
f. The business of BP has been and is presently being
conducted in compliance with applicable federal,
state and local governmental laws, rules, regulations
and ordinances. There are no suits, actions, claims,
investigations or proceedings pending, or, to the
knowledge of BP, threatened against BP and there are
no outstanding orders, judgments, injunctions, awards
or decrees pending against BP, which alone or in
combination could have a material adverse effect upon
BP.
g. There is no existing, condition or event which at
present or which with the passage of time can
reasonably be expected to have a material adverse
change in the business, assets, operations, affairs,
prospects or financial condition of BP.
h. BP has all franchise, permits, licenses and other
similar authorizations necessary for the conduct of
its business as now being conducted and
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contemplated and is not aware of any state of facts
that would make impossible or impractical to continue
or obtain any similar authorizations necessary for
the conduct of its business as planned to be
conducted.
7. Conditions of Closing
a. As part of the conversion of the Note, CDA will
receive an opinion of counsel to BP substantially to
the effect that:
i. The Shares issued to CDA have been duly
authorized, validly issued and are fully
paid and nonassessable, free and clear of
any adverse liens, claims or encumbrances.
ii. The Shares may be freely traded pursuant to
Rule 144 promulgated by the Securities and
Exchange Commission.
iii. No authorizations, approvals, or permits of
any governmental authority or regulatory
body, is required in connection with the
lawful issuance and sale of the Shares to
CDA.
b. BP will pay for all of the reasonable fees, costs and
expenses of CDA incurred in connection with this
transaction, including, without limitation, the
reasonable fees and costs of CDA's counsel.
8. Additional Agreements
a. Subject to the terms hereof, this letter agreement
constitutes the entire agreement of the parties as to
the repayment of the Note and supersedes all prior
agreements whether written or oral related to the
Note other than the warrants for Shares issued in
connection with the Note and the terms of the Letter
Agreement dated June 14, 1995 as such terms relate to
such warrants. Specifically, but not in limitation of
the foregoing, the Loan Agreement and Security
Agreement each dated March 7, 1995 and the Collateral
Assignment and Security Agreement, dated July 27,
1993 as amended on March 7, 1995 are hereby cancelled
and are of no further force or effect. Warrants for
Shares issued in connection with the Note and the
terms of the Letter Agreement dated June 14, 1995
remain in full force and effect except as modified
herein.
b. CDA and BP will take such further actions as are
necessary or desirable to effectuate the purposes of
the foregoing terms and conditions.
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c. This letter agreement may not be modified except by a
writing executed by both parties.
d. This agreement shall be binding upon and inure to the
benefit of the parties and their respective
successors and assigns.
e. This agreement shall be governed by and construed
under the laws of the State of Connecticut.
9. Effective Date
The parties agree that the effective date of this letter
agreement for all purposes shall be March 31, 997.
10. Notices
Any notice or other communication of one party to the other
shall be in writing and delivered by facsimile transaction, hand
delivery or U.S. mail addressed to CDA at the above address and
addressed to BP at 384 Q Merrow Road, Tolland, CT 06084. Any notice
shall be effective upon receipt.
If the foregoing accurately reflects CDA's understanding of its
agreement with BP on the matters set forth above, please sign and return a copy
of this letter agreement to BP.
Sincerely,
BIO-PLEXUS, INC.
By:_______________________________
Accepted and Agreed:
CONNECTICUT DEVELOPMENT AUTHORITY
By:_____________________________