TABLE OF CONTENTS
Page
1. Subscription for Purchase of Securities . . . . . . . . . . . . . . 2
1.1 Sale and Purchase. . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Reporting Company. . . . . . . . . . . . . . . . . . . . . . . 3
1.3 Terms of the Series 4 Preferred Stock and Warrants . . . . . . 3
2. Payment of Purchase Price; Delivery of Securities . . . . . . . . . 3
2.1 Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.2 Purchase Price and Payment . . . . . . . . . . . . . . . . . . 3
2.3 Restrictive Legends. . . . . . . . . . . . . . . . . . . . . . 4
3. Representations, Warranties and Covenants of Subscriber . . . . . . 4
3.1 Investment Intent. . . . . . . . . . . . . . . . . . . . . . . 4
3.2 Certain Risk . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.3 Prior Investment Experience. . . . . . . . . . . . . . . . . . 5
3.4 No Review by the SEC . . . . . . . . . . . . . . . . . . . . . 5
3.5 Not Registered . . . . . . . . . . . . . . . . . . . . . . . . 6
3.6 No Public Market . . . . . . . . . . . . . . . . . . . . . . . 6
3.7 Sophisticated Investor . . . . . . . . . . . . . . . . . . . . 6
3.8 SEC Filing . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.9 Documents, Information and Access. . . . . . . . . . . . . . . 7
3.10 No Registration, Review or Approval. . . . . . . . . . . . . . 7
3.11 Transfer Restrictions. . . . . . . . . . . . . . . . . . . . . 7
3.12 No Short Sale. . . . . . . . . . . . . . . . . . . . . . . . . 8
3.13 Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.14 Accuracy or Representations and Warranties . . . . . . . . . . 8
3.15 Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.16 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4. Representations, Warranties and Covenants of the
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.1 Organization, Authority, Qualification . . . . . . . . . . . . 9
4.2 Authorization. . . . . . . . . . . . . . . . . . . . . . . . . 9
4.3 Ownership of, and Title to, Securities . . . . . . . . . . . . 9
4.4 Exemption from Registration. . . . . . . . . . . . . . . . . . 10
4.5 Use of Proceeds from this Offering . . . . . . . . . . . . . . 10
5. Registration Rights . . . . . . . . . . . . . . . . . . . . . . . . 10
5.1 Registration . . . . . . . . . . . . . . . . . . . . . . . . . 10
5.2 Current Registration Statement . . . . . . . . . . . . . . . . 11
5.3 0.1% Penalty . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.5 Other Provisions . . . . . . . . . . . . . . . . . . . . . . . 12
5.6 Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.7 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . 12
6. Indemnification.. . . . . . . . . . . . . . . . . . . . . . . . . . 13
6.1 By the Company . . . . . . . . . . . . . . . . . . . . . . . . 13
6.2 By the Subscriber. . . . . . . . . . . . . . . . . . . . . . . 13
6.3 Procedure. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7. Securities Legends and Notices. . . . . . . . . . . . . . . . . . . 14
8. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.1 Amendment; Waiver. . . . . . . . . . . . . . . . . . . . . . . 16
8.2 Binding Effect; Assignment . . . . . . . . . . . . . . . . . . 16
8.3 Governing Law; Litigation Costs. . . . . . . . . . . . . . . . 16
8.4 Severability . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.5 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.6 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.7 Transfer Taxes . . . . . . . . . . . . . . . . . . . . . . . . 17
8.8 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . 17
8.9 Authority; Enforceability. . . . . . . . . . . . . . . . . . . 17
8.10 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.11 No Third Party Beneficiaries . . . . . . . . . . . . . . . . . 18
8.12 Public Announcements . . . . . . . . . . . . . . . . . . . . . 18
Exhibit "A" - Certificate of Designations
Exhibit "B" - Common Stock Purchase Warrant
SUBSCRIPTION AND PURCHASE AGREEMENT
for
2,500 SHARES OF SERIES 4 CLASS D CONVERTIBLE PREFERRED STOCK,
PAR VALUE $.001 PER SHARE
and
375,000 WARRANTS, EACH WARRANT TO PURCHASE
ONE SHARE OF COMMON STOCK
of
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(a Delaware corporation)
THIS SUBSCRIPTION AND PURCHASE AGREEMENT (the "Agreement") is
dated as of the 9th day of June, 1997, by and between PERMA-FIX
ENVIRONMENTAL SERVICES, INC., a Delaware corporation, having offices
at 1940 Northwest 67th Place, Gainesville, Florida 32653 (the
"Company"), and RBB BANK AKTIENGESELLSCHAFT, organized under the
laws of Austria, and having its principal offices at Burgring 16,
8101 Graz, Austria (the "Subscriber").
W I T N E S S E T H:
WHEREAS, the Subscriber and the Company have arranged for the
Agreement to provide for the subscription and, if such subscription
as set forth in this Agreement is accepted by the Company, the
purchase by the Subscriber, on the terms and subject to the
conditions set forth in this Agreement, of (i) an aggregate of 2,500
shares of a new series of convertible preferred stock, par value
$.001 per share, to be designated by the Company's Board of
Directors as "Series 4 Class D Convertible Preferred Stock" (the
"Series 4 Preferred Stock"), with such Series 4 Preferred Stock
containing such terms, conditions, restrictions and provisions as
set forth in the Certificate of Designation attached hereto as
Exhibit "A," and (ii) an aggregate of 375,000 common stock purchase
warrants (a "Warrant" and collectively, the "Warrants"), with each
common stock purchase warrant providing for the purchase of one
share of the Company's common stock, par value $.001 per share (the
"Common Stock"), at the exercise prices set forth herein (the Series
4 Preferred Stock and the Warrants are collectively referred to
herein from time to time as the "Securities");
WHEREAS, the Common Stock is listed for trading on the Boston
Stock Exchange and the National Association of Securities Dealers
Automated Quotation system ("NASDAQ"), and the Company is subject
to the reporting requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and
has been subject to such filing requirements for the past ninety
(90) days;
WHEREAS, the Subscriber is an "accredited investor" as such
term is defined in Rule 501 of Regulation D promulgated under the
Securities Act of 1933, as amended (the "Securities Act");
WHEREAS, the Subscriber is not a "U. S. Person," as such term
is defined in Regulation S promulgated under the Securities Act;
WHEREAS, in order to induce the Subscriber to enter into this
Agreement and to subscribe for and purchase the Securities on the
terms and subject to the conditions hereof, the Company is granting
certain registration rights under the Agreement with respect to the
Common Stock issuable upon the conversion of the Series 4 Preferred
Stock and the Common Stock issuable upon the exercise of the
Warrants;
WHEREAS, in reliance upon the representations made by the
Subscriber in this Agreement, the transactions contemplated by this
Agreement are such that the offer and sale of Securities by the
Company hereunder will be exempt from registration under applicable
federal (U. S.) securities laws since this is a private placement
and intended to be a nonpublic offering pursuant to Sections 4(2)
and/or 3(b) of the Securities Act and/or Regulation D promulgated
under the Securities Act; and,
WHEREAS, the Securities to be sold in accordance with this
Agreement will not be quoted or listed for trading on any securities
exchange, organized market or quotation system at the time of
acquisition hereunder.
NOW, THEREFORE, for and in consideration of the premises, and
the mutual representations, warranties, covenants and agreements set
forth herein, and for other good and valuable consideration, receipt
of which is hereby acknowledged, the parties hereto agree as
follows:
1. Subscription for Purchase of Securities.
1.1 Sale and Purchase. On the basis of the representations,
warranties, covenants and agreements, and subject to the
terms and conditions set forth herein, on the Closing
Date, the Company agrees to sell, transfer, convey and
deliver to the Subscriber, and the Subscriber agrees to
purchase, acquire and accept delivery from the Company,
the Securities for an aggregate purchase price of Two
Million Five Hundred Thousand United States ("U. S.")
Dollars ($2,500,000) ("Purchase Price").
1.2 Reporting Company. Although the Securities, the shares
of Common Stock issuable upon conversion of the Series 4
Preferred Stock (the "Conversion Shares") and the shares
of Common Stock issuable upon exercise of the Warrants
(the "Warrant Shares") shall not be registered as of the
Closing under federal or state securities laws or any
rules or regulations promulgated thereunder, the Company
is reporting company under the Securities Exchange Act of
1934, as amended (the "Exchange Act") and has filed with
the Securities and Exchange Commission (the "SEC") all
reports required to be filed by the Company under Section
13 or 15(d) of the Exchange Act. The Subscriber has had
the opportunity to review, and has reviewed, all such
reports and information which the Subscriber deemed
material to an investment decision regarding the purchase
of the Securities.
1.3 Terms of the Series 4 Preferred Stock and Warrants. The
Series 4 Preferred Stock shall contain and be subject to
the terms, conditions, preferences and restrictions set
forth in the Certificate of Designations attached hereto
as Exhibit "A." The Warrants will be substantially in
the form attached hereto as Exhibit "B," subject to the
terms, and with the date and exercise price of such
Warrants to be as set forth in Section 2.
2. Payment of Purchase Price; Delivery of Securities.
2.1 Closing. The consummation of this Agreement (the
"Closing") will occur on June 11, 1997 (the "Closing
Date"), at the offices of the Company or at such other
mutually convenient time or at such other mutually
convenient place as agreed upon by the parties.
2.2 Purchase Price and Payment. At the Closing, the
Subscriber shall deliver to the Company the Purchase
Price, in cash by wire transfer. Upon receipt by the
Company of the Purchase Price, the Company shall cause to
be delivered: (a) to Conner & Winters, A Professional
Corporation, a certificate or certificates representing
the 2,500 shares of Series 4 Preferred Stock purchased by
the Subscriber, in such denominations as Subscriber
requests in writing, to be held in escrow by Conner &
Winters, A Professional Corporation, for the Subscriber;
and (b) to the Subscriber, (i) written evidence from the
Secretary of State of the State of Delaware that the
Certificate of Designations has been filed in the Office
of the Secretary of State of the State of Delaware on or
before the Closing Date; (ii) a Warrant, dated the
Closing Date, entitling the Subscriber to purchase after
December 31, 1997, an aggregate of up to 187,500 Warrant
Shares at an exercise price equal to $2.10 per share
("$2.10 Warrant"), and (iii) a Warrant, dated the Closing
Date, entitling the Subscriber to purchase after
December 31, 1997, an aggregate of up to 187,500 Warrant
Shares at an exercise price equal to $2.50 per share
("$2.50 Warrant"). If at any time the Warrant Shares are
covered by an effective registration statement filed with
the SEC and the average closing bid price of the Common
Stock for ten (10) consecutive trading days shall be in
excess of $3.50 with respect to the $2.10 Warrants or in
excess of $4.00 with respect to the $2.50 Warrants, then
the Company shall have the option to redeem the Warrants
for an amount equal to one cent ($0.01) per Warrant Share
covered by the Warrants. Each Warrant to be delivered at
the Closing will have an expiration date of June 9, 2000.
2.3 Restrictive Legends. Subscriber agrees that, subject to
the provisions of Section 5 below, all certificates
representing the Securities shall bear the restrictive
legend substantially in the form set forth in Section 7
below which shall include, but not be limited to, a
legend to the effect that (a) the Securities represented
by such certificate have not been registered under the
Securities Act, and (b) unless there is an effective
registration statement relating to the Securities, the
Securities may not be offered, sold, transferred,
mortgaged, pledged or hypothecated without an exemption
from registration and an opinion of counsel to the
Company with respect thereto, or an opinion from counsel
for the Subscriber, which opinion is satisfactory to the
Company, to the effect that registration under the Act is
not required in connection with such sale or transfer and
the reasons therefor. The legend on all such
certificates shall make reference to the registration
rights set forth in Section 5 hereof.
3. Representations, Warranties and Covenants of Subscriber. The
Subscriber hereby represents, warrants and covenants to the Company
as follows:
3.1 Investment Intent. The Subscriber represents and
warrants that the Securities are being, and any
underlying Conversion Shares and Warrant Shares will be,
purchased or acquired solely for the Subscriber's own
account, for investment purposes only and not with a view
toward the distribution or resale to others. The
Subscriber acknowledges, understands and appreciates that
the Securities have not been registered under the
Securities Act by reason of a claimed exemption under the
provisions of the Securities Act which depends, in large
part, upon the Subscriber's representations as to
investment invention, investor status, and related and
other matters set forth herein. Subscriber understands
that, in the view of the United States Securities and
Exchange Commission (the "SEC"), among other things, a
purchase now with an intent to distribute or resell would
represent a purchase and acquisition with an intent
inconsistent with its representation to the Company, and
the SEC might regard such a transfer as a deferred sale
for which the registration exemption is not available.
3.2 Certain Risk. The Subscriber recognizes that the
purchase of the Securities involves a high degree of risk
in that (a) the Company has sustained losses through
March 31, 1997, from its operations, and may require
substantial funds in addition to the proceeds of this
private placement; (b) that the Company has a substantial
accumulated deficit; (c) an investment in the Company is
highly speculative and only investors who can afford the
loss of their entire investment should consider investing
in the Company and the Securities; (d) an investor may
not be able to liquidate his investment; (e)
transferability of the Securities is extremely limited;
(f) in the event of a disposition an investor could
sustain the loss of his entire investment; (g) the
Securities represent non-voting equity securities, and
the right to convert into and purchase shares of voting
equity securities in a corporate entity that has an
accumulated deficit; (h) no return on investment, whether
through distributions, appreciation, transferability or
otherwise, and no performance by, through or of the
Company, has been promised, assured, represented or
warranted by the Company, or by any director, officer,
employee, agent or representative thereof; and, (i) while
the Common Stock is presently quoted and traded on the
Boston Stock Exchange and the Nasdaq SmallCap Market and
while the Subscriber is a beneficiary of certain
registration rights provided herein, the Securities
subscribed for and that are purchased under this
Agreement, the Conversion Shares, and the Warrant Shares
(i) are not registered under applicable federal (U. S.)
or state securities laws, and thus may not be sold,
conveyed, assigned or transferred unless registered under
such laws or unless an exemption from registration is
available under such laws, as more fully described
herein, and (ii) the Securities subscribed for and that
are to be purchased under this Agreement are not quoted,
traded or listed for trading or quotation on the NASDAQ,
or any other organized market or quotation system, and
there is therefore no present public or other market for
the Securities, nor can there be any assurance that the
Common Stock of the Company will continue to be quoted,
traded or listed for trading or quotation on the Boston
Stock Exchange or the Nasdaq SmallCap Market or on any
other organized market or quotation system.
3.3 Prior Investment Experience. The Subscriber acknowledges
that it has prior investment experience, including
investment in non-listed and non-registered securities,
or has employed the services of an investment advisor,
attorney or accountant to read all of the documents
furnished or made available by the Company to it and to
evaluate the merits and risks of such an investment on
its behalf, and that it recognizes the highly speculative
nature of this investment.
3.4 No Review by the SEC. The Subscriber hereby acknowledges
that this offering of the Securities has not been
reviewed by the SEC because this private placement is
intended to be a nonpublic offering pursuant to Sections
4(2) and/or 3(b) of the Securities Act and/or Regulation
D promulgated under the Securities Act.
3.5 Not Registered. The Subscriber understands that the
Securities, the Conversion Shares and the Warrant Shares
have not been registered under the Securities Act by
reason of a claimed exemption under the provisions of the
Securities Act which depends, in part, upon the
Subscriber's investment intention. In this connection,
the Subscriber understands that it is the position of the
SEC that the statutory basis for such exemption would not
be present if its representation merely meant that its
present intention was to hold such securities for a short
period, such as the capital gains period of tax statutes,
for a deferred sale, for a market rise (assuming that a
market develops), or for any other fixed period.
3.6 No Public Market. The Subscriber understands that there
is no public market for the Series 4 Preferred Stock or
the Warrants. The Subscriber understands that although
there is presently a public market for the Common Stock,
including the Common Stock issuable upon conversion of
the Series 4 Preferred Stock or exercise of the Warrants,
Rule 144 (the "Rule") promulgated under the Securities
Act requires, among other conditions, a one-year holding
period following full payment of the consideration
therefor prior to the resale (in limited amounts) of
securities acquired in a nonpublic offering without
having to satisfy the registration requirements under the
Securities Act. The Subscriber understands that the
Company makes no representation or warranty regarding its
fulfillment in the future of any reporting requirements
under the Exchange Act, or its dissemination to the
public of any current financial or other information
concerning the Company, as is required by the Rule as one
of the conditions of its availability. The Subscriber
understands and hereby acknowledges that the Company is
under no obligation to register the Securities or the
Conversion Shares or the Warrant Shares under the
Securities Act, except as set forth in Section 5 hereof.
The Subscriber agrees to hold the Company and its
directors, officers and controlling persons and their
respective heirs, representatives, successors and assigns
harmless and to indemnify them against all liabilities,
costs and expenses incurred by them as a result of any
misrepresentation made by the Subscriber contained herein
or any sale or distribution by the Subscriber in
violation of the Securities Act or any applicable state
securities or "blue sky" laws (collectively, "Securities
Laws").
3.7 Sophisticated Investor. That (a) the Subscriber has
adequate means of providing for the Subscriber's current
financial needs and possible contingencies and has no
need for liquidity of the Subscriber's investment in the
Securities; (b) the Subscriber is able to bear the
economic risks inherent in an investment in the
Securities and that an important consideration bearing on
its ability to bear the economic risk of the purchase of
Securities is whether the Subscriber can afford a
complete loss of the Subscriber's investment in the
Securities and the Subscriber represents and warrants
that the Subscriber can afford such a complete loss; and
(c) the Subscriber has such knowledge and experience in
business, financial, investment and banking matters
(including, but not limited to, investments in
restricted, non-listed and non-registered securities)
that the Subscriber is capable of evaluating the merits,
risks and advisability of an investment in the
Securities.
3.8 SEC Filing. The Subscriber acknowledges that it has been
previously furnished with true and complete copies of the
following documents which have been filed with the SEC
pursuant to Sections 13(a), 14(a), 14(c) or 15(d) of the
Exchange Act since January 1, 1997, and that such have
been furnished to the Subscriber a reasonable time prior
to the date hereof: (a) the Company's Form 10-K for the
year ended December 31, 1996, and (b) the Company's Form
10-Q for the quarter ended March 31, 1997.
3.9 Documents, Information and Access. The Subscriber's
decision to purchase the Securities is not based on any
promotional, marketing or sales materials, and the
Subscriber and its representatives have been afforded,
prior to purchase thereof, the opportunity to ask
questions of, and to receive answers from, the Company
and its management, and has had access to all documents
and information which Subscriber deems material to an
investment decision with respect to the purchase of
Securities hereunder.
3.10 No Registration, Review or Approval. The Subscriber
acknowledges and understands that the private offering
and sale of Securities pursuant to this Agreement has not
been reviewed or approved by the SEC or by any state
securities commission, authority or agency, and is not
registered under the Securities Laws. The Subscriber
acknowledges, understands and agrees that the Shares are
being offered and sold hereunder pursuant to (i) a
private placement exemption to the registration
provisions of the Securities Act pursuant to Section 3(b)
and/or Section 4(2) of such Securities Act and/or
Regulation D promulgated under the Securities Act) and
(ii) a similar exemption to the registration provisions
of applicable state securities laws.
3.11 Transfer Restrictions. That Subscriber will not transfer
any Securities purchased under this Agreement or any
Conversion Shares or Warrant Shares purchased under this
Agreement unless such Securities are registered under the
Securities Laws, or unless an exemption is available
under such Securities Laws, and the Company may, if it
chooses, where an exemption from registration is claimed
by such Subscriber, condition any transfer of Securities,
Conversion Shares or Warrant Shares out of the
Subscriber's name on an opinion of the Company's counsel,
to the effect that the proposed transfer is being
effected in accordance with, and does not violate, an
applicable exemption from registration under the
Securities Laws, or an opinion of counsel to the
Subscriber, which opinion is satisfactory to the Company,
to the effect that registration under the Securities Act
is not required in connection with such sale or transfer
and the reasons therefor.
3.12 No Short Sale. The Subscriber expressly agrees that
until such time that it has sold all of the Securities
and/or all of the Conversion Shares and Warrant Shares
that it shall not, directly or indirectly, through an
affiliate (as that term is defined under Rule 405
promulgated under the Securities Act) or by, with or
through an unrelated third party or entity, whether or
not pursuant to a written or oral understanding,
agreement, arrangement, scheme, or artifice of nature
whatsoever, engage in the short selling of the Company's
Common Stock or any other equity securities of the
Company, whether now existing or hereafter issued, or
engage in any other activity of any nature whatsoever
that has the same effect as a short sale, or is a de
facto or de jure short sale, of the Company's Common
Stock or any other equity security of the Company,
whether now existing or hereafter issued, including, but
not limited to, the sale of any rights pursuant to any
understanding, agreement, arrangement, scheme or artifice
of any nature whatsoever, whether oral or in writing,
relative to the Company's Common Stock or any other
equity securities of the Company whether now existing or
hereafter created.
3.13 Reliance. The Subscriber understands and acknowledges
that the Company is relying upon all of the
representations, warranties, covenants, understandings,
acknowledgements and agreements contained in this
Agreement in determining whether to accept this
subscription and to sell and issue the Securities to the
Subscriber.
3.14 Accuracy or Representations and Warranties. All of the
representations, warranties, understandings and
acknowledgments that Subscriber has made herein are true
and correct in all material respects as of the date of
execution hereof. The Subscriber will perform and comply
fully in all material respects with all covenants and
agreements set forth herein, and the Subscriber covenants
and agrees that until the acceptance of this Agreement by
the Company, the Subscriber shall inform the Company
immediately in writing of any changes in any of the
representations or warranties provided or contained
herein.
3.15 Indemnity. The Subscriber hereby agrees to indemnify and
hold harmless the Company, and the Company's successors
and assigns, from, against and in all respects of any
demands, claims, actions or causes of action,
assessments, liabilities, losses, costs, damages,
penalties, charges, fines or expenses (including, without
limitation, interest, penalties, and attorney and
accountants' fees, disbursements and expenses), arising
out of or relating to any breach by Subscriber of any
representations, warranty, covenant or agreement made by
Subscriber in this Agreement. Such right to
indemnification shall be in addition to any and all other
rights of the Company under this Agreement or otherwise,
at law or in equity.
3.16 Survival. The Subscriber expressly acknowledges and
agrees that all of its representations, warranties,
agreements and covenants set forth in this Agreement
shall be of the essence hereof and shall survive the
execution, delivery and Closing of this Agreement, the
sale and purchase of the Securities, the conversion of
the Series 4 Preferred Stock, exercise of the Warrants,
and the sale of the Conversion Shares and the Warrant
Shares.
4. Representations, Warranties and Covenants of the Company. In
order to induce Subscriber to enter into this Agreement and to
purchase the Securities, the Company hereby represents, warrants and
covenants to Subscriber as follows:
4.1 Organization, Authority, Qualification. The Company is
a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware.
The Company has full corporate power and authority to own
and operate its properties and assets and to conduct and
carry on its business as it is now being conducted and
operated.
4.2 Authorization. The Company has full power and authority
to execute and deliver this Agreement and to perform its
obligations under and consummate the transactions
contemplated by this Agreement. Upon the execution of
this Agreement by the Company and delivery of the
Securities, this Agreement shall have been duly and
validly executed and delivered by the Company and shall
constitute the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance
with its terms.
4.3 Ownership of, and Title to, Securities. The Securities
to be purchased by the Subscriber are, and all Conversion
Shares and Warrant Shares, when issued, will be, duly
authorized, validly issued, fully paid and nonassessable
shares of the capital stock of the Company, free of
personal liability. Upon consummation of the purchase of
the Securities (and upon the exercise of the Warrants and
conversion of the Preferred Stock, in whole or in part)
pursuant to this Agreement, the Subscriber will own and
acquire title to the Securities (and the Warrant Shares
and the Conversion Shares, as the case may be) free and
clear of any and all proxies, voting trusts, pledges,
options, restrictions, or other legal or equitable
encumbrance of any nature whatsoever (other than the
restrictions on transfer due to Securities Laws or as
otherwise provided for in this Agreement or the
Certificate of Designation).
4.4 Exemption from Registration. The offer and sale of
Securities to the Subscriber in accordance with the terms
and provisions of this Agreement is being effected in
accordance with the Securities Act, pursuant to a private
placement exemption to the registration provisions of the
Act pursuant to Section 3(b) and/or 4(2) of such Act
and/or Regulation D promulgated under such Act, based on
the representations, warranties and covenants made by the
Subscriber contained in this Agreement.
4.5 Use of Proceeds from this Offering. The net proceeds
from the sale of the Series 4 Preferred Stock are
estimated to be approximately $2,287,500 after payment of
placement fees to brokers of $200,000 and legal fees and
expenses of approximately $12,500, but prior to any fees
and expenses relating to the registration of the
Conversion Shares and the Warrant Shares pursuant to the
terms of Section 5 hereof. The Company intends to
utilize the net proceeds for capital improvements at its
various facilities, to reduce outstanding trade payables,
and for general working capital.
5. Registration Rights. In order to induce the Subscriber to
enter into this Agreement and purchase the Securities, the Company
hereby covenants and agrees to grant to the Subscriber the rights
set forth in this Section 5 with respect to the registration of the
Warrant Shares and the Conversion Shares.
5.1 Registration. Subject to the terms of Section 5 hereof,
the Company agrees that within thirty (30) days after the
Closing Date, it shall prepare and file with the SEC, a
registration statement on Form S-3 or equivalent form
(the "Registration Statement") and such other documents,
including a prospectus, as may be necessary in the
opinion of counsel for the Company in order to comply
with the provisions of the Securities Act, so as to
permit a public offering and sale by the Subscriber of up
to 1,482,000 shares of Common Stock issuable upon
conversion of the Series 4 Preferred Stock, plus up to
250,000 shares of Common Stock, if any, issuable as
payment of dividends on the Series 4 Preferred Stock
pursuant to the terms of the Series 4 Preferred Stock,
and 375,000 shares of Common Stock issuable upon exercise
of the Warrants. The Company shall use its reasonable
efforts to cause such Registration Statement to become
effective at the earliest possible date after filing. In
connection with the offering of such Common Stock
registered pursuant to this Section 5, the Company shall
take such actions as shall be reasonably necessary to
qualify the Common Stock covered by such Registration
Statement under such "blue sky" or other state securities
laws for offer and sale as shall be reasonably necessary
to permit the public offering and sale of shares of
Common Stock covered by such Registration Statement;
provided, however, that the Company shall not be required
(a) to qualify generally to do business in any
jurisdiction where it would not otherwise be required to
qualify but for this subparagraph, (b) to subject itself
to taxation in any such jurisdiction, or (c) to consent
to general service of process in any such jurisdiction.
It is expressly agreed that in no event are any
registration rights being granted to the Series 4
Preferred Stock itself, but only with respect to the
underlying Conversion Shares issuable upon exercise of
the Series 4 Preferred Stock and the Warrant Shares
issuable upon the exercise of the Warrants.
5.2 Current Registration Statement. Once effective, the
Company shall use its reasonable efforts to cause such
Registration Statement filed hereunder to remain current
and effective for a period of three (3) years or until
the shares of Common Stock covered by such Registration
Statement are sold by the Subscriber, whichever is
sooner. The Subscriber shall promptly provide all such
information and materials and take all such action as may
be required in order to permit the Company to comply with
all applicable requirements of the SEC and to obtain any
desired acceleration of the effective date of such
registration statement.
5.3 0.1% Penalty. In the event the Registration Statement
referred to in Section 5.1 above is not declared
effective by the Commission before 5:00 p.m. Eastern
Daylight Savings Time on the one hundred twentieth
(120th) day after the Closing Date (or the next business
day if such one hundred twentieth (120th) day is a
Saturday, Sunday or legal holiday), the Company agrees to
pay to the Subscriber a penalty in an amount equal to
one-tenth of one percent of the Purchase Price, payable
in cash in U. S. dollars. Once the Registration
Statement is declared effective, if the Registration
Statement becomes subsequently ineffective prior to the
expiration of three (3) years from the Closing Date or
the shares of Common Stock covered by the Registration
Statement are sold by the Subscriber, whichever occurs
first, the Company agrees to pay to the Subscriber the
0.1% penalty for each calendar day that the Registration
Statement is not effective, equal to the product of the
number of outstanding shares of Series 4 Preferred Stock
on each such day times One U. S. Dollar ($1.00)
5.4 2.0% Penalty. In the event the Registration Statement
referred to in Section 5.1 above is not declared
effective by the Commission before 5:00 p.m. Eastern
Daylight Savings Time on the one hundred fiftieth (150th)
day after the Closing Date (or the next business day of
if such one hundred fiftieth day (150th) is a Saturday,
Sunday or legal holiday), the Company agrees to pay to
the Subscriber a one-time penalty in an amount equal to
two percent (2%) of the Purchase Price, payable in cash
or Common Stock of the Company at the Company's election.
Once declared effective, if the Registration Statement
becomes subsequently ineffective for a period of thirty
(30) consecutive calendar days, the Company agrees to pay
to the Subscriber a one-time penalty in an amount equal
to the product of (a) the number of shares of Series 4
Preferred Stock outstanding on such thirtieth (30th) day
times (b) Twenty Dollars ($20.00). The penalties set
forth in this Section 5.4 shall be payable at the
election of the Company in cash or shares of the
Company's Common Stock. If the Company elects to deliver
such payment in Common Stock of the Company, the number
of shares of Common Stock to be issued to the Subscriber
shall be determined by dividing the dollar value of the
penalty by the average closing bid price of the Company's
Common Stock as reported on the NASDAQ for the preceding
five (5) trading days prior to the day on which the
penalty is imposed.
5.5 Other Provisions. In connection with the offering of any
Conversion Shares and/or Warrant Shares registered
pursuant to this Section 5, the Company shall furnish to
the Subscriber such number of copies of any final
prospectus as it may reasonably request in order to
effect the offering and sale of the Conversion Shares
and/or Warrant Shares to be offered and sold. In
connection with any offering of Conversion Shares and/or
Warrant Shares registered pursuant to this Section 5, the
Company shall (a) furnish to the underwriters (if any),
at the Company's expense, unlegended certificates
representing ownership of the Conversion Shares and/or
Warrant Shares sold under such Registration Statement in
such denominations as requested and (b) instruct any
transfer agent and registrar of the Conversion Shares
and/or Warrant Shares to release immediately any stop
transfer order, and to remove any restrictive legend,
with respect to Conversion Shares and/or Warrant Shares
included in any registration becoming effective pursuant
to this Agreement upon the sale of such shares by the
Subscriber.
5.6 Costs. Subject to the immediately following sentence,
the Company shall in all events pay and be responsible
for all fees, expenses, costs and disbursements
associated with the Registration Statement relating to
the Conversion Shares and the Warrant Shares under this
Section 5, including filing fees, fees, costs and
disbursements of any counsel, accountants and other
consultants representing the Company in connection
therewith. Notwithstanding anything set forth herein to
the contrary, Subscriber shall be responsible for and pay
any and all underwriting discounts and commissions in
connection with the sale of the Conversion Shares and/or
Warrant Shares pursuant hereto and all fees of its legal
counsel and other advisors retained in connection with
reviewing any registration statement.
5.7 Successors. The Company will require any successor
(whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all
of the business, properties, stock or assets of the
Company, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that
the Company would be required to perform it if no such
succession had taken place.
6. Indemnification.
6.1 By the Company. Subject to the terms of this Section 6,
the Company will indemnify and hold harmless the
Subscriber, its directors and officers, and any
underwriter (as defined in the Securities Act) for the
Subscriber and each person, if any, who controls the
Subscriber or such underwriter within the meaning of the
Act, from and against, and will reimburse the Subscriber
and each such underwriter and controlling person with
respect to, any and all loss, damage, liability, cost and
expense to which such holder or any such underwriter or
controlling person may become subject under the Act or
otherwise, insofar as such losses, damages, liabilities,
costs or expenses are caused by any untrue statement or
alleged untrue statement of any material fact contained
in the Registration Statement filed with the SEC pursuant
to Section 5, any prospectus contained therein or any
amendment or supplement thereto, or arise out of, or are
based upon, the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances in which they were made not misleading;
provided, however, that the Company will not be liable in
any such case to the extent that any such loss, damage,
liability, cost or expense arises out of, or is based
upon, an untrue statement or alleged untrue statement or
omission or alleged omission so made in conformity with
information furnished by the Subscriber, such underwriter
or such controlling person in writing specifically for
use in the preparation thereof.
6.2 By the Subscriber. Subject to the terms of this Section
6, the Subscriber will indemnify and hold harmless the
Company, its directors and officers, any controlling
person and any underwriter from and against, and will
reimburse the Company, its directors and officers, any
controlling person and any underwriter with respect to,
any and all loss, damage, liability, cost or expense to
which the Company or any controlling person and/or any
underwriter may become subject under the Securities Act
or otherwise, insofar as such losses, damages,
liabilities, costs or expenses are caused by any untrue
statement or alleged untrue statement of any material
fact contained in such Registration Statement filed with
the SEC pursuant to Section 5, any prospectus contained
therein or any amendment or supplement thereto, or arise
out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements
therein, in light of the circumstances in which they were
made, not misleading, in each case to the extent, but
only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was so
made in reliance upon, and in strict conformity with,
written information furnished by, or on behalf of, the
Subscriber specifically for use in the preparation
thereof.
6.3 Procedure. Promptly after receipt by an indemnified
party pursuant to the provisions of Section 6.1 or 6.2 of
notice of the commencement of any action involving the
subject matter of the foregoing indemnity provisions,
such indemnified party will, if a claim thereof is to be
made against the indemnifying party pursuant to the
provisions of Section 6.1 or 6.2, promptly notify the
indemnifying party of the commencement thereof; but the
omission to so notify the indemnifying party will not
relieve the indemnifying party from any liability which
it may have to any indemnified party otherwise than
hereunder. In case such action is brought against any
indemnified party and the indemnified party notifies the
indemnifying party of the commencement thereof, the
indemnifying party shall have the right to participate
in, and, to the extent that it may wish, assume the
defense thereof; or, if there is a conflict of interest
which would prevent counsel for the indemnifying party
from also representing the indemnified party, the
indemnified parties have the right to select only one (1)
separate counsel to participate in the defense of such
action on behalf of all such indemnified parties. After
notice from the indemnifying parties to such indemnified
party of the indemnifying parties' election so to assume
the defense thereof, the indemnifying parties will not be
liable to such indemnified parties pursuant to the
provisions of said Section 6.1 or 6.2 for any legal or
other expense subsequently incurred by such indemnified
parties in connection with the defense thereof, other
than reasonable costs of investigation, unless (a) the
indemnified parties shall have employed counsel in
accordance with the provisions of the preceding sentence;
(b) the indemnifying parties shall not have employed
counsel satisfactory to the indemnified parties to
represent the indemnified parties within a reasonable
time after the notice of the commencement of the action
or (c) the indemnifying party has authorized the
employment of counsel for the indemnified party at the
expense of the indemnifying parties.
7. Securities Legends and Notices. Subscriber represents and
warrants that it has read, considered and understood the following
legends, and agrees that such legends, substantially in the form and
substance set forth below, shall be placed on all of the
certificates representing the Series 4 Preferred Stock and Warrants:
Series 4 Preferred Stock Legends
NEITHER THIS PREFERRED STOCK NOR ANY SHARES OF COMMON
STOCK ISSUABLE UPON THE CONVERSION OF THIS PREFERRED
STOCK HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT") OR QUALIFIED
UNDER APPLICABLE STATE SECURITIES LAWS. THIS PREFERRED
STOCK AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS PREFERRED STOCK MAY NOT BE OFFERED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT AND QUALIFICATION IN
EFFECT WITH RESPECT THERETO UNDER THE SECURITIES ACT AND
UNDER ANY APPLICABLE STATE SECURITIES LAW OR WITHOUT THE
PRIOR WRITTEN CONSENT OF PERMA-FIX ENVIRONMENTAL
SERVICES, INC. AND AN OPINION OF PERMA-FIX ENVIRONMENTAL
SERVICES, INC.'S COUNSEL, OR AN OPINION FROM COUNSEL FOR
THE HOLDER HEREOF, WHICH OPINION IS SATISFACTORY TO THE
COMPANY, THAT SUCH REGISTRATION AND QUALIFICATION IS NOT
REQUIRED UNDER APPLICABLE FEDERAL AND STATE SECURITIES
LAWS OR AN EXEMPTION THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES OF COMMON STOCK
ISSUABLE UPON CONVERSION ARE ALSO SUBJECT TO THE
REGISTRATION RIGHTS SET FORTH IN THAT CERTAIN
SUBSCRIPTION AND PURCHASE AGREEMENT BY AND BETWEEN THE
HOLDER HEREOF AND THE COMPANY, DATED JUNE 9, 1997, A COPY
OF WHICH IS ON FILE AT THE COMPANY'S PRINCIPAL EXECUTIVE
OFFICE.
Warrant Legends
NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE OF THIS WARRANT, HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT") OR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK
ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE
OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AND QUALIFICATION IN EFFECT WITH RESPECT
THERETO UNDER THE SECURITIES ACT AND UNDER ANY APPLICABLE
STATE SECURITIES LAW OR WITHOUT THE PRIOR WRITTEN CONSENT
OF PERMA-FIX ENVIRONMENTAL SERVICES, INC. AND AN OPINION
OF PERMA-FIX ENVIRONMENTAL SERVICES, INC.'S COUNSEL, OR
AN OPINION FROM COUNSEL FOR THE HOLDER HEREOF, WHICH
OPINION IS SATISFACTORY TO THE COMPANY, THAT SUCH
REGISTRATION AND QUALIFICATION IS NOT REQUIRED UNDER
APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN
EXEMPTION THEREFROM.
NOTWITHSTANDING THE FOREGOING, THE SHARES ISSUABLE UPON
EXERCISE ARE SUBJECT TO THE REGISTRATION RIGHTS SET FORTH
IN THAT CERTAIN SUBSCRIPTION AND PURCHASE AGREEMENT
BETWEEN THE HOLDER HEREOF AND THE COMPANY, DATED JUNE 9,
1997, A COPY OF WHICH IS ON FILE AT THE COMPANY'S
PRINCIPAL EXECUTIVE OFFICE.
8. Miscellaneous.
8.1 Amendment; Waiver. Neither this Agreement nor the
Warrants shall be changed, modified or amended in any
respect except by the mutual written agreement of the
parties hereto. Any provision of this Agreement or the
Warrants may be waived in writing by the party which is
entitled to the benefits thereof. No waiver of any
provision of this Agreement or the Warrants shall be
deemed to, or shall constitute a waiver of, any other
provision hereof or thereof (whether or not similar), nor
shall nay such waiver constitute a continuing waiver.
8.2 Binding Effect; Assignment. Neither this Agreement nor
the Warrants, or any rights or obligations hereunder or
thereunder, are assignable by the Subscriber.
8.3 Governing Law; Litigation Costs. This Agreement and its
validity, construction and performance shall be governed
in all respects by the internal laws of the State of
Delaware without giving effect to such State's conflicts
of laws provisions. Each of the Company and the
Subscriber expressly and irrevocably consent to the
jurisdiction and venue of the federal courts located in
Wilmington, Delaware. Each of the parties agrees that in
the event either party brings an action to enforce any of
the provisions of this Agreement or to recovery for an
alleged breach of any of the provisions of this
Agreement, each party shall be responsible for its own
legal costs and disbursements during the pendency of any
such action; provided, however, that after any such
action has been reduced to a final, unappealable
judgment, the prevailing party shall be entitled to
recover from the other party all reasonable, documented
attorneys' fees and disbursements and court costs from
the other party.
8.4 Severability. Any term or provisions of this Agreement
or the Warrants which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction only, be
ineffective only to the extent of such prohibition or
unenforceability without invalidating the remaining
provisions hereof or thereof affecting the validity or
enforceability of such provision in any other
jurisdiction.
8.5 Headings. The captions, headings and titles preceding
the text of each or any Section, subsection or paragraph
hereof are for convenience of reference only and shall
not affect the construction, meaning or interpretation of
this Agreement or the Warrants or any term or provisions
hereof or thereof.
8.6 Counterparts. This Agreement may be executed in one or
more original or facsimile counterparts, each of which
shall be deemed an original and all of which shall be
considered one and the same agreement, binding on all of
the parties hereto, notwithstanding that all parties are
not signatories to the same counterpart. Upon delivery
of an executed counterpart by the undersigned Subscriber
to the Company, which in turn is executed and delivered
by the Company, this Agreement shall be binding as one
original agreement between Subscriber and the Company.
8.7 Transfer Taxes. Each party hereto shall pay all such
sales, transfer, use, gross receipts, registration and
similar taxes arising out of, or in connection with, the
transactions contemplated by this Agreement and the
Warrants (collectively, the "Transfer Taxes") as are
payable by such party under applicable law, and the
Company shall pay the cost of any documentary stock
transfer stamps, if any, to be affixed to the
certificates representing the Shares and any Warrant
Shares to be sold.
8.8 Entire Agreement. This Agreement, along with the
Warrants and the Certificate of Designations, merges and
supersedes any and all prior agreements, understandings,
discussions, assurances, promises, representations or
warranties among the parties with respect to the subject
matter hereof, and contains the entire agreement among
the parties with respect to the subject matter set forth
herein and therein.
8.9 Authority; Enforceability. The Subscriber is duly
authorized to enter into this Agreement and to perform
all of its obligations hereunder. Upon the execution and
delivery of this Agreement by the Subscriber, this
Agreement shall be enforceable against the Subscriber in
accordance with its terms.
8.10 Notices. Except as otherwise specified herein to the
contrary, all notices, requests, demands and other
communications required or desired to be given hereunder
shall only be effective if given in writing, by hand or
by fax, by certified or registered mail, return receipt
requested, postage prepaid, or by U. S. Express Mail
service, or by private overnight mail service (e.g.,
Federal Express). Any such notice shall be deemed to
have been given (i) on the business day actually received
if given by hand or by fax, (ii) on the business day
immediately subsequent to mailing, if sent by U.S.
Express Mail service or private overnight mail service,
or (iii) five (5) business days following the mailing
thereof, if mailed by certified or registered mail,
postage prepaid, return receipt requested, and all such
notices shall be sent to the following addresses (or to
such other address or addresses as a party may have
advised the other in the manner provided in this Section
8.11:
If to the Company: Dr. Louis F. Centofanti
Perma-Fix Environmental
Services, Inc.
1940 Northwest 67th Place
Gainesville, Florida 32653
Fax No.: (352) 373-0040
with copies Irwin H. Steinhorn, Esquire
simultaneously Conner & Winters
by like means to: One Leadership Square
Suite 1700
211 North Robinson
Oklahoma City, Oklahoma 73102
Fax No.: (405) 232-2695
If to the Herbert Strauss
Subscriber: RBB Bank Aktiengesellschaft
Burgring 16, 8010 Graz, Austria
Fax No.: 011-43-316-8072 ext. 392
8.11 No Third Party Beneficiaries. This Agreement and the
rights, benefits, privileges, interests, duties and
obligations contained or referred to herein shall be
solely for the benefit of the parties hereto and no third
party shall have any rights or benefits hereunder as a
third party beneficiary or otherwise hereunder.
8.12 Public Announcements. Neither Subscriber nor any
officer, director, stockholder, employee, affiliate or
affiliated person or entity of Subscriber, shall make or
issue any press releases or otherwise make any public
statements or make any disclosures to any third person or
entity with respect to the transactions contemplated
herein and will not make or issue any press releases or
otherwise make any public statements of any nature
whatsoever with respect to the Company without the
express prior approval of the Company.
IN WITNESS WHEREOF, the Company and the undersigned Subscriber
have each duly executed this Agreement as of this 9th day of June,
1997.
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis F. Centofanti
____________________________
Dr. Louis F. Centofanti
Chief Executive Officer
RBB BANK AKTIENGESELLSCHAFT
By /s/ Herbert Strauss
__________________________
Herbert Strauss
Headtrader
SUBSCRIPTION AND PURCHASE AGREEMENT
for
2,500 SHARES OF SERIES 4 CLASS D CONVERTIBLE PREFERRED STOCK,
PAR VALUE $.001 PER SHARE
and
375,000 WARRANTS, EACH WARRANT TO PURCHASE
ONE SHARE OF COMMON STOCK
of
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(a Delaware corporation)
June 9, 1997