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 (Date of Earliest Event Reported): January 28, 2000
LEXON, INC.
(Exact name of registrant as specified in its charter)
Oklahoma 0-26915 73-1533326
(State of incorporation) (SEC File Number) (IRS Employer ID No.)
8908 South Yale Avenue, Suite 409
Tulsa, Oklahoma 74137
918-492-4125
(Address and telephone number of
principal executive office)
Item 2. Acquisition or Disposition of Assets
On January 29, 2000, Lexon purchased 100% of the common stock of Cancer
Diagnostic, Inc. ("CDI"), a Florida corporation, according to the terms of a
Stock Purchase Agreement, attached as Exhibit 10.1. CDI owns the exclusive
worldwide license to the Telomerase Assay, a patent-pending blood test for lung
cancer being developed at the University of Maryland, Baltimore ("UMB"). A copy
of the license agreement is attached as Exhibit 10.2. CDI is party to a two-year
sponsored research agreement, attached as Exhibit 10.3, to fund the development
and commercialization of the Telomerase Assay for the ELISA format at the
University of Maryland, Baltimore.
Lexon purchased all of the outstanding common stock of CDI from CDI's
sole shareholder UTEK Corporation ("UTEK") for a total of $200,000. Lexon paid
$50,000 in cash and gave UTEK a secured promissory note for $150,000, attached
as Exhibit 10.4. The secured promissory note bears interest at 10% per year and
is payable in three monthly installments of $50,000 each, due on April 30, May
31 and June 30, 2000. The interest rate will increase to 12% per year on any
unpaid principal balance after June 30, 2000. To secure the promissory note,
Lexon pledged all of the shares of common stock of CDI pursuant to the Pledge
and Security Agreement, attached as Exhibit 10.5. The shares were place in
escrow and will be released upon payment in full of Lexon's obligation to UTEK.
CDI was formed by UTEK for the purpose of transferring the Telomerase
Assay technology from the University of Maryland, Baltimore to the private
sector. CDI has had no operations during the period of its existence. Therefore,
no proforma financial information of CDI has been presented.
UTEK, a Florida corporation, is a technology merchant that specializes
in the transfer of technology from universities and government research
facilities to the private sector. UTEK has relationships with major universities
and government research facilities in the U.S. and in Europe. UTEK owns
approximately 1,000,000 shares (or about 14.7% of the outstanding shares) of
Lexon Common Stock.
By reason of the stock purchase, CDI is a wholly-owned subsidiary of
Lexon. CDI owns the exclusive worldwide license to the Telomerase Assay. Under
the terms of the sponsored research agreement, CDI must pay $124,537 to UMB on
or before January 1, 2001. CDI is also obligated under the terms of the license
agreement to pay a royalty of 4% of Net Sales of products sold by Lexon. The
license agreement provides for minimum annual royalties for the life of the
agreement, which coincides with the life of the last to expire patent covering
the licensed technology. The minimum annual royalties range from $2,500 per year
beginning in 2002 to a maximum of $4,000 per year beginning in 2006 and
continuing each year thereafter for the life of the Agreement. In addition, the
Agreement provides for royalties of 2% of Net Sales of products sold by
sublicensees and 50% of all consideration received by CDI for up-front,
milestone or other payments from sublicensees.
The Agreement and Plan of Merger between Lexon and CDI was cancelled by
agreement of the parties. The consulting agreement between Lexon and UTEK
whereby Lexon agreed to pay UTEK $132,000 was also cancelled by agreement of the
parties.
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ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
Exhibit Description
10.1 Stock Purchase Agreement between Registrant and Cancer
Diagnostics, Inc. Dated January 28, 2000
10.2 License Agreement between Cancer Diagnostics, Inc. and
University of Maryland, Baltimore dated August 27, 1999
10.3 Sponsored Research Agreement Cancer Diagnostics, Inc. and
University of Maryland, Baltimore dated August 27, 1999 and
amended September 23, 1999
10.4 Secured Promissory Note dated January 28, 2000
10.5 Pledge and Security Agreement dated January 28, 2000
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
LEXON, INC.
/s/ GIFFORD M. MABIE
President
Date: February 14, 2000
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