U.S. 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): October 17, 2003
COMMISSION FILE NUMBER: 000-32141
Nutra Pharma Corp.
(Exact name of registrant as specified in its charter)
California 91-2021600
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(State or jurisdiction of incorporation (I.R.S. Employer I.D. No.)
or organization
485 Martin Lane, Beverly Hills, California 90210
(Address of principal executive offices) (Zip Code)
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Registrant's telephone number: (310) 858-7088
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(Former name or former address, if changed since last report)
Item 1. Change In Control of Registrant
Not Applicable
Item 2. Acquisition or Disposition of Assets
On or about September 19, 2003, Nutra Pharma Corp. entered into an agreement
with Infectech, Inc., to acquire over 40% of Infectech's outstanding common
stock by exchange of Nutra Pharma shares, with a commitment to make a
subsequent tender offer for up to all the remaining common shares. The
agreement was approved by a vote of over 80% of Infectech's common shares by
its shareholders on October 17, 2003, resulting the in the closing of the
acquisition agreement. As a result of the acquisition, Nutra Pharma is now
engaged in the business of developing and marketing diagnostic tests and
therapeutics for infectious human diseases, in addition to the development of
drugs for multiple sclerosis, or MS, HIV and neuromuscular disorders.
COMPANY INFORMATION - INFECTECH, INC.
Infectech, Inc. is a biotechnology/genomics company, founded in 1989 to engage
in the research and development and marketing of diagnostic tests for
infectious human diseases. Infectech's patented technology, when applied in a
commercial product, will offer to the medical community a means for the rapid
and accurate product identification of pathogens, including Pseudomonas, which
is the major cause of death in intensive care units and burn units in the
world. The company specializes in the research, development, and production of
laboratory kits used in the rapid identification and antibiotic testing of
disease-causing pathogens. The company's patents span the identification and
antibiotic sensitivity testing of 34 disease-causing bacteria, including:
Tuberculosis, Pseudomonas, M. avium and Nocardia. These bacteria are cited as a
prominent cause of death in patients with cancer, cystic fibrosis, and AIDS, as
well as patients undergoing surgery. The company's web site is
www.infectech.com.
Mycobacterium avium intracellulare ("MAI")is the bacterial infection most often
associated with AIDS patients in the developed world. Mycobacterium
tuberculosis is the causative agent of the world's deadliest infection.
Infectech intends to use its technology to create cost-effective diagnostic
kits for identifying and testing disease-causing microorganisms which use
paraffin sole carbon source baiting as the source of nutrition for identifying
and antibiotic sensitivity testing. Carbon source baiting will be used for such
pathogens as Nocardia, Candida tropicalis, Aspergillus, Pseudomonas and a
variety of nontuberculous mycobactera. In addition, Infectech intends to use
its hydrophobic bating technology to identify and perform antibiotic
sensitivity testing on Tuberculosis Complex organisms (Mycobacterium
tuberculosis, Mycobacterium bovis and Mycobacterium, africanum). Also, other
non-paraffin utilizing organisms will be tested for their ability to be
isolated and antibiotic sensitivity tested. Management believes that the
combination of Infectech's patented slide culture methodology with
amplification and/or gene probes will enable hospital laboratories to identify
and ascertain the correct antibiotics to be used against each of the pathogens
within a greatly reduced time frame. As a research and development company,
Infectech plans to generate its income through the licensing of its technology
together with associated royalties.
Industry
The search for the world's deadliest infection, Mycobacterium tuberculosis and
other members of its Genus (Mycobacterium)such as AIDS-related Mycobacterium
avium-intracellulare ("MAI") has always been very difficult. The organisms are
slow growing and require a rigorous pre-preparation to prevent overgrowth of
other more rapidly growing organisms often found co-existing in the specimens.
Thus, the handling of mycobacterial specimens has usually required highly
specialized manpower and equipment. In the AIDS era, mycobacteria such as
Mycobacterium tuberculosis and Mycobacterium avium-intracellulare were seen in
ever increasing numbers.
This problem has caused many problems for both the developed and underdeveloped
countries of the world. The larger metropolitan centers have their specialized
laboratories and equipment, but, in rural centers, it has been necessary to
send specimens on to central or district health labs where specialized
laboratories and equipment are found. In undeveloped countries, laboratory
diagnostics have been either very rudimentary or non-existent. In the present
American Health Care environment of reduced budgeting, many hospitals are
seeking more affordable methodologies.
As a result, there is a need for a technology that would make efficient use of
all available manpower and reduce the level of skill and technology needed to
(a) isolate and distinguish between Mycobacterium tuberculosis and non-
tuberculous organisms and (b) reduce the need for pre-preparation and (c) assay
for antibiotic sensitivity.
The Infectech Solution
During the 1980s, Infectech researchers discovered that certain grades of
paraffin wax, when used in conjunction with a slide, could aid in the
identification and treatment of various bacterial pathogens with less
difficulty, lower costs and in less time than some of the conventional
methodologies.
Infectech is positioning itself to capture the market for MAI and Tuberculosis
bacteria diagnosis and antibiotic sensitivity testing. Prior to the AIDS
epidemic, MAI was a rare disease. After the advent of widespread AIDS
infection, MAI was found to infect AIDS patients at a very high rate. It has
been estimated by world health authorities that more than 70% of AIDS patients
harbor an MAI infection. MAI affects the bond marrow, spleen, liver and lungs.
It compromises the lymph nodes, thereby further destroying the patient's immune
system. It has been shown that MAI also causes opportunistic infections among
non-HIV infected pediatric and elderly persons. MAI is believed to be a major
contributor to AIDS wasting syndrome. In addition to MAI, there are at least 20
other disease-causing paraffinophilic bacteria for which Infectech's IDENTIKIT
will be a time-saving easy to use diagnostic and treatment tool. Tuberculosis
is one of the most prevalent bacterial infections in the world and is an
expanding problem.
Infectech initially plans to market its product through licensing and
distribution arrangements with large, well-established medical diagnostic
companies. Infectech's markets will potentially include hospitals, clinical
laboratories, medical research institutions, medical schools, pharmaceutical
companies (the antibiotic sensitivity testing methodology can be used to create
new drugs to treat paraffinophilic microorganisms), and physicians' offices.
Infectech is exploring the forming of a business relationship for the
manufacture of its paraffin-coated slides which is used solely as a central
component of the IDENTIKIT. It is important that the manufacturer provides
necessary quality control accountability. Infectech President David McClelland
is focusing on making available a quality product as well as focusing on
product sales. In the event that Infectech does not manufacture any of its
proposed products directly, it will have to rely on others to manufacture such
products. Although Infectech is currently engaged in preliminary efforts to
establish other manufacturing arrangements with respect to certain of its
proposed products, there can be no assurance that Infectech will be able to
enter into any such additional arrangements, on acceptable terms or at all, or
that any manufacturing will be able to meet any demand for such products on
timely basis.
Marketing and Sales
It is Infectech's plan to enter the marketplace through a license arrangement
with a large international corporation already involved in servicing the
medical diagnostics industry. Infectech intends to license its IDENTIKITS for
both manufacturing and sales. Initially, every effort will be made to identify
potential, exclusive licensees. Infectech would like to select one of the
largest medical companies already in the medical diagnostics business as the
exclusive licensee. There can be no assurances, however, that an agreement with
a licensee will be reached. In support of the licensee's marketing efforts,
Infectech will identify ultimate customers for Infectech's products both within
the U.S. and outside of the U.S. Those hospitals with quality diagnostic
laboratories will be identified along with distributors for hospital technical
products and private diagnostic laboratories.
Any contractual arrangements with others concerning the marketing and
distribution of its products may result in a lack of control by Infectech over
any or all of the marketing and distribution of such products.
Although Infectech is currently engaged in preliminary efforts to establish
such marketing arrangements, there can be no assurance that Infectech will be
able to enter into any such arrangements on terms acceptable to Infectech, or
at all.
Infectech's future growth and profitability will depend, in large part, on the
success of its personnel and others in fostering acceptance by the medical
community. Such acceptance will be substantially dependent on educating the
medical community as to the distinctive characteristics and perceived benefits
of Infectech's proposed products. There can be no assurance that Infectech's
efforts or those of others will be successful, or that any of its products will
receive the necessary acceptance by the medical community.
Bioremediation
On September 14, 1999, Infectech and BioRemedial Technologies, Inc. (BRT)
signed an Exclusive Licensing Agreement for the application of Infectech
technology in the field of bio-remediation. This Agreement re-stated the
earlier Agreement between the companies and provided for their future roles in
this field. BRT is a company which specializes in the biodegradation of
chlorinated compounds and hydrocarbons. Unlike other bioremediation companies,
BRT uses specially prepared microbes to degrade volatile organic compounds from
air, ground water and soil. BRT began practical applications of the Infectech
technology and began generating revenues in its utilization which resulted in
royalty payments to Infectech.
Under the 1999 Agreement, Infectech has entered into a worldwide licensing
agreement with BRT for a period of ten (10) years. BRT will utilize Infectech's
intellectual property solely as it applies in the field of bioremediation for
the creation of microbes for the specific task of bioremediation. Infectech
shall receive a royalty of 15% per bioremediation project during the licensing
period. Infectech has the right to terminate the exclusivity provisions of the
license. Infectech thereby terminated the exclusivity of BRT. In the Agreement,
Infectech allows BRT the ability to obtain intellectual property protection for
the methodology involved in degrading VOC air emission, and ground water and
solid remediation. TCE is the most abundant groundwater contaminant in the
United States. TCE is not utilized as a food or energy source by the
micro-organisms in the soil or groundwater. As a result, the chemical
accumulated in the environment and generates a public health risk.
Competition
Infectech is engaged in a rapidly evolving and highly competitive field.
Competition from biotechnology companies, medical device manufacturers,
pharmaceutical and chemical companies and other companies within the medical
product market is generally intense and is expected to increase. Most of such
companies have substantially greater capital resources, research and
development staffs, facilities and experience in obtaining regulatory
approvals, as well as in the manufacturing, marketing and distribution of
products, than Infectech. Academic institutions, hospitals, governmental
agencies and other public and private research organizations also conduct
research and seek patent protection and may develop competing products or
technologies on their own or through joint ventures. In addition, technologies
that may be developed in the future may be the basis of competitive products.
There can be no assurances that Infectech's competitors will not succeed in
developing technologies and products that are more effective and/or less costly
than any that are being developed by Infectech or which could render
Infectech's technologies obsolete.
At this time, Infectech has limited competition in methodologies for the
identification and antibiotic sensitivity testing of paraffinophilic bacteria.
Most of the existing identification methods are expensive and time-consuming.
While much of Infectech's technology is patented, there can be no assurances,
however, that larger, better- financed competitors will not enter the market or
that others will not develop competing technologies.
Employees
Infectech employs two full-time employees and two part- time employees.
Infectech shall employ additional individuals as required and as its finances
permit.
Governmental Regulation
In order to gain broad acceptance in the marketplace, Infectech will need to
receive approval from the Food and Drug Administration ("FDA") and other
equivalent regulatory bodies outside of the United States. This approval will
be based upon clinical testing programs at major medical centers. Data obtained
from these institutions will enable Infectech to apply to the FDA for
acceptance of its technology through a 510-K applications process. Once the
data has been fully gleaned, it is expected that this process would take less
than ninety (90) days. President David McClellan has been conferring with a
scientist who he feels could be very helpful to Infectech in this endeavor.
Infectech's progress in this endeavor has been limited due to its monetary
constraints.
No assurance can be given that Infectech will successfully develop or
commercialize any proposed application of this technology. Infectech has had
early royalties based on the use of its technology in the field of
bioremediation through a relationship with Bioremedial Technologies, Inc.
Bioremedial Technologies has not recently focused on using Infectech
technology. Infectech has had very limited sales of its product in the medical
and research field. All product candidates under research and development by
Infectech will be subject to regulatory approval by the FDA and, to the extent
applicable, comparable foreign agencies or State health departments prior to
marketing. The process of complying with FDA regulations and the regulations of
other governmental authorities will be costly and time consuming, and Infectech
will not be able to commence marketing and commercial sale of any of its
proposed products in the United States (other than for research purposes)
unless it receives certain clearance or a privilege from the FDA. Failure to
comply with applicable regulatory requirements can result in fines, suspensions
of approvals and restrictions. In addition, changes in existing regulations, or
the adoption of new regulations, could prevent Infectech from obtaining future
clearances or approvals. There can be no assurance that the FDA will approve
Infectech's product candidates. Infectech's proposed products are also subject
to third-party reimbursement policies, such as governmental programs and
private insurance plans, where health care services are provided to patients.
The market for Infectech's proposed products could be adversely affected by
changes in governmental and private third-party payor policies or by federal
legislation that would reduce such reimbursements. Furthermore, there can be no
assurances that third parties will not develop competing technologies.
Management
Directors and Officers of Infectech
The following table sets forth the name, position held with Infectech and terms
of office of each of the officers and directors of Infectech.
Name Position Term(s) of Office
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Mitchell S. Felder, M.D. CEO, Treasurer, Inception to Present
and Director Inception to July 2003
President May 2003 to Present
Acting Chairman
David C. McClelland President and Director July 2003 to Present
Stephen R. Lewis Director 1995 to Present
Len Aronoff, Esq. Director July, 2003 to Present
Legal Consultant 2002
General Counsel 2003
Anthony P. Cavallo Director
Mitchell S. Felder, M.D., is one of the founders of Infectech and serves as
Acting Chairman of Infectech's Board of Directors and CEO of the Company. Dr.
Felder is a contributor to certain of the patent applications for Infectech and
has worked in Infectech's clinical medical effort. Dr. Felder has previously
served as CEO and President of Infectech, Inc. over the past six years. He
received his M.D. degree from the University of Rome, Italy in 1983, and is an
attending neurologist at UPMC's hospital system in Greenville, Pennsylvania.
Dr. Felder is married to Susan Felder and is a first cousin of Mr. Bernstein.
David C. McClelland has served as a director and President of the Company since
July 2003. Mr. McClelland has over 15 years experience in technology and
business development with Ben Franklin Technology Partners. He holds a
Bachelor's Degree in Mechanical Engineering of Technology from Gannon
University, Erie, Pennsylvania and several degree credits from Penn State
University in business, plastics and engineering. Mr. McClelland is an
apprentice graduate of General Electric Company in 1976.
Stephen R. Lewis has served as a director of Infectech since 1995. Mr. Lewis is
an investment broker with, and shareholder of Butler Wick & Co.,Inc. of Sharon,
Pennsylvania since 1988. He received his Bachelor's Degree in Finance from
Indiana University of Pennsylvania in 1983.
Len Aronoff,Esq. has served as a director since July 2003. Attorney Aronoff has
been a member of the Florida Bar since 1984. He had been instrumental in
Infectech's raise of money and becoming a publicly traded corporation.
Attorney Aronoff specializes in Securities Law, blue sky and manual exemption
matters. Prior to becoming an Attorney, Mr. Aronoff spent 20 years as a radio
and television newsman, writer, producer and director in New York and Miami. He
also taught communications at Syracuse University, Ithaca College and Emerson
College in Boston. He is a veteran of 4 1/2 years in the U.S. Army including 17
months in Korea.
Anthony P. Cavallo holds an MBA from New York University, earning it in 1970.
He received his Bachelor's Degree in Business Administration from Wagner
College in 1963. Mr. Cavallo is President of Pyramid, Inc., a management and
information systems consulting firm. He currently serves on other technology
based company boards.
Description of Infectech Securities
Infectech is authorized to issue 20,000,000 shares of Common Stock, par value
$.02 per share. As of the date of the acquisition agreement, there were
approximately 12,302,368 shares of Common Stock outstanding. The holders of the
Common Stock are entitled to one vote per share with respect to all matters on
which holders of Infectech's Common Stock are entitled to vote. Holders of
Common Stock do not have preemptive, subscription or conversion rights. The
stock transfer agent for Infectech, Inc. stock is Florida Atlantic Stock
Transfer, Inc., Nob Hill Road, Tamarac, Florida.
Market for common stock and related matters
Infectech, Inc. common stock is traded on the National Quotation Board, "pink
sheets" under the symbol IFEC. Trading commenced in April 1999.
Item 3. Bankruptcy or Receivership
Not Applicable
Item 4. Changes in Registrant's Certifying Accountant
Not Applicable
Item 5. Other Events
Item 6. Resignations of Registrant's Directors
None
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Business Acquired.
It is impractical to provide the required financial statements for Nutra Pharma
Corp. at this time. The registrant intends to filed such financial statements
as soon as is practical, but not later than 60 days after this report on Form
8-K is filed with the commission.
(b) Pro forma Financial Information.
It is impractical to provide the required financial statements for Nutra
Pharma, Inc. at this time. Nutra Pharma Corp. will file pro forma consolidated
financial statements for itself and its wholly owned subsidiary within 60 days
after the filing of this
report.
(c) Exhibits.
There are attached hereto the following exhibits:
7.1 Acquisition Agreement of September 19, 2003
Item 8. Change in Fiscal Year
Not applicable
Item 9. Regulation FD Disclosure
Not applicable
Item 10. Amendments to the Registrant's Code of Ethics, or Waiver of a
Provision of the Code of Ethics
Not applicable
Item 11. Temporary Suspensions of Trading Under Registrant's Employee Benefit
Plans
Not applicable
Item 12. Results of Operations and Financial Condition
Not applicable
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Dated: October 17, 2003
Nutra Pharma Corp.
Rik Deitsch
-----------------------
By: Rik Deitsch
Chief Executive Officer
CERTIFICATION
In connection with the current report of Nutra Pharma Corp. (the "Company") on
Form 8K for October 17, 2003, as filed with the Securities and Exchange
Commission on the date hereof, Zirk Engelbrecht and Rik Deitsch certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that to the best of their knowledge:
1. The report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the report fairly presents, in all
material respects, the financial condition and results of the Company.
Dated: October 17, 2003 By: Zirk Engelbrecht
------------------------------
Chief Financial Officer
Dated: October 17, 2003 By: Rik Deitsch
-----------------------------
Rik Deitsch, C.E.O.
Exhibit 7.1 Acquisition agreement of September 19, 2003
THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE "1933 ACT"), NOR REGISTERED UNDER ANY
STATE SECURITIES LAW, AND ARE "RESTRICTED SECURITIES" AS THAT TERM IS DEFINED
IN RULE 144 UNDER THE 1933 ACT. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE 1933 ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE
SATISFACTION OF THE COMPANY.
ACQUISITION AGREEMENT
THIS AGREEMENT (hereinafter "the agreement"), made and entered into as of
the 19th day of September, 2003, by and between Nutra Pharma Corp., a
California corporation (hereinafter "Nutra Pharma"), Infectech Corporation,
(hereinafter "Infectech"), by and for the benefit of the Selling Shareholders
("Shareholders") herein, in consideration of the mutual promises and covenants
contained herein, who agree as follows:
1. RECITALS:
This agreement is made and entered into with reference to the
following facts and circumstances:
A. Nutra Pharma is a publicly held California corporation, with
currently issued and outstanding, 45,634,500 shares of common stock.
B. Nutra Pharma is a publicly held, reporting company, whose securities
are quoted on the NASD over-the- counter bulletin board under the trading
symbol, "NPHC," and whose business plan consists of the development of bio
pharmaceutical products.
C. Infectech is a publicly held company, with currently issued and
outstanding stock of 12,302,368 common shares, who is interested in becoming
acquired by Nutra Pharma, in order to improve its opportunities to obtain
financing for development of its pharmaceutical and medical testing products.
D. Infectech is a publicly held, non reporting company, whose securities
are quoted on the pink sheets under the trading symbol, "IFEC."
2. ACQUISITION OF MAJORITY INTEREST OF INFECTECH STOCK.
A. In exchange for shares of Nutra Pharma restricted common stock,
Shareholders hereby agree to transfer to Nutra Pharma, shares of common stock
of Infectech representing over 40% of the issued and outstanding common shares.
The share exchange shall be structured in such a way as to constitute a tax
free or deferred exchange, to minimize the tax consequences to Nutra Pharma,
Infectech, and the shareholders.'The issuance of shares shall be made pursuant
to Section 4(1) of the Securities Act of 1933, and/or Regulation D of the
Securities and Exchange Commission.
B. The ratio of exchange shall be one share of'Nutra Pharma common stock
for every 2 shares of Infectech common stock.
3. POST CLOSING COVENANTS
A. Nutra Pharma shall make a tender offer to the shareholders of
Infectech, offering Nutra Pharma restricted common stock in exchange for their
Infectech common shares, at the ratio of one share of Nutra Pharma stock for
every two shares of Infectech. The offer of shares shall be made pursuant to
the exemption of registration of securities contained within Regulation D of
the Securities and Exchange Commission. Accredited investors and the first 35
unaccredited investors to accept and subscribe to the tender offer shall
receive restricted Nutra Pharma shares.
B. Infectech shall be entitled to nominate David McClelland and Mitchell
Felder to the board of directors of Nutra Pharma, who shall serve pursuant to a
written Director's Agreement, and be compensated therefor with the sum of
500,000 shares of Nutra Pharma restricted stock each. Nutra Pharma shall be
entitled to nominate one director to the board of directors of Infectech.
C. Nutra Pharma shall invest up to $400,000 in the business plan of
Infectech, upon the submission of a budget and timeline and approval of Nutra
Pharma's board of directors.
D. Infectech shall cause all of the current outstanding options to
officers and directors to be cancelled.
E. At closing, there shall be no debt owed to officers and directors by
Infectech.
F. Nutra Pharma shall advance capital for the payment of the ongoing
obligations of Infectech, upon the submission of a budget and approval of Nutra
Pharma's board of directors.
4. CONDITIONS PRECEDENT TO NUTRA PHARMA'S PERFORMANCE
The exchange of Nutra Pharma stock is conditioned upon the following:
A. There shall have been no material adverse change in the business or
conditions (financial or otherwise) of Infectech since the execution of the
letter of intent between the parties.
B. The satisfactory completion of the parties' due diligence
investigation of Infectech, and its respective business, officers, directors
and shareholders.
C. The representations and warranties contained in this agreement shall
have been true in all material respects when made, and, in addition, shall be
true and correct in all material respects as of the Closing Date, except for
representations and warranties specifically relating to a time or times other
than the Closing Date (which shall be true and correct in all material respects
at such time or times) and except for changes contemplated and permitted by
this Agreement, with the same force and effect as if made as of the Closing
Date. Infectech shall have performed or complied in all material respects with
all terms, agreements, and covenants and conditions required by this Agreement
to be performed by it or prior to the Closing Date, and shall deliver a
certificate of its President and Secretary or Assistant Secretary to such
effect on the Closing Date.
D. Infectech shall not have issued any of its common stock up to and
including the closing of this agreement, without the informed consent of Nutra
Pharma, and covenants to issue such additional stock to Nutra Pharma as may be
required to maintain the equity position of Nutra Pharma in Infectech as of the
closing of this agreement.
E. The consent of Infectech shareholders to this transaction shall be
obtained. In this regard, Infectech agrees to notice a shareholder's meeting
for approval of the transaction, which must be approved by over 50% of its
shareholders.
5. CONDITIONS PRECEDENT TO INFECTECH'S PERFORMANCE
The exchange of Nutra Pharma stock is conditioned on the following:
A. There shall have been no material adverse change in the business or
conditions (financial or otherwise) of Nutra Pharma since the execution of the
letter of intent between the parties.
B. The satisfactory completion of Infectech's due diligence
investigation of Nutra Pharma and its business, operations and officers and
directors.
C. The representations and warranties contained in this agreement shall
have been true in all material respects when made, and, in addition, shall be
true and correct in all material respects as of the Closing Date, except for
representations and warranties specifically relating to a time or times other
than the Closing Date (which shall be true and correct in all material respects
at such time or times) and except for changes contemplated and permitted by
this Agreement, with the same force and effect as if made as of the Closing
Date. Nutra Pharma shall have performed or complied in all material respects
with all terms, agreements, and covenants and conditions required by this
Agreement to be performed by it or prior to the Closing Date.
6. REPRESENTATIONS AND WARRANTIES OF INFECTECH
Infectech hereby represents and warrants to Nutra Pharma as follows:
A. Infectech is a corporation duly formed and validly existing and in
good standing under the laws of the state of Delaware, it has all necessary
corporate powers to own its properties and carry on its business as now owned
and operated by it, and is in good standing in every jurisdiction in which
failure to qualify would have a material adverse affect on its business and
financial condition, and has the corporate power to enter into and perform this
agreement, subject only to the approval of its shareholders. Such execution,
delivery and performance of this Agreement and all other instruments and
documents to be delivered hereunder have been duly authorized by all necessary
corporate action on the part of Infectech and Nutra Pharma , and will not
contravene or violate or constitute a breach of the terms of either of its
Articles of Incorporation, founding documents, or By-Laws, or conflict with,
result in a breach of, or entitle any party to terminate or call a default with
respect to any instrument or decree to which either is bound or any contract or
any instrument, judgment, order, decree, law, rule or regulation applicable to
it. Neither Infectech, nor their shareholders is a party to, or subject to, or
bound by any judgment, injunction, or decree of any court or governmental
authority or agreement which may restrict or interfere with its performance of
this Agreement. This Agreement has been duly executed and delivered and
constitutes, and the other instruments and documents to be delivered by
Infectech hereunder will constitute, the valid and binding obligations of both
of them, enforceable against it in accordance with their respective terms.
B. Except as otherwise set forth herein, no consent of any party to any
contract or arrangement to which Infectech or Nutra Pharma is a party or by
which either is bound is required for the execution, performance, or
consummation of this Agreement.
C. There are no actions, suits, proceedings, orders, investigations or
claims pending or, to either Infectech or Nutra Pharma 's knowledge, threatened
against either one of them, at law or in equity, or before any federal, state
or other governmental body, other than those disclosed in the due diligence
materials.
D. The representations and warranties contained in this Section will be
accurate, true and correct, in all respects, on and as of the date of Closing
as though made at such date in identical language.
E. All of Infectech's assets are free and clear of security interests,
liens, pledges, charge and encumbrances, equities or claims, except those
obligations to shareholders and others as reported on its financial statements.
F. Neither Infectech, nor any of its officers and directors has ever been
convicted of any felony or misdemeanor offense involving moral turpitude; nor
have they been the subject of any temporary or permanent restraining order
resulting from unlawful transactions in securities; nor are they now, or have
they ever been, a defendant in any lawsuit alleging unlawful business practices
or the unlawful sale of securities; nor have they been the debtor in any
proceedings, whether voluntary or involuntary, filed in the U.S. Bankruptcy
Court.
G. The execution, delivery and performance of this agreement by Infectech
does not require the consent, waiver, approval, license or authorizations of
any person or public authority which has not been obtained, does not violate,
with or without the giving of notice or the passage of time or both, any law
applicable to either Infectech, and does not conflict with or result in a
breach or termination of any provisions of, or constitute a default under, or
result in the creation of any lien, charge or encumbrance upon any of the
property or assets of Infectech .
H. Infectech has complied with all laws, ordinances, regulations and
orders which have application to their respective businesses, the violation of
which might have a material adverse effect on their respective financial
condition or results of operations, and possesses all governmental licenses and
permits material to and necessary for the conduct of their respective business,
the absence of which might have a material adverse effect on their respective
financial condition or results of operations. All such licenses and permits are
in full force and effect, no violations are or have been recorded in respect of
any such licenses or permits, and no proceeding is pending or threatened to
revoke or limit any such licenses or permits.
I. The authorized share capital of Infectech consists of 20,000,000
shares of common class stock, 12,302,368 of which are issued and outstanding,
and are owned, beneficially and of record by Infectech's shareholders and no
other share capital of Infectech is issued and outstanding. There are no
subscriptions, options or other agreements or commitments, obligating Infectech
to issue any shares or securities convertible into its shares at the date of
this agreement, except for those to former officers and directors, which are
currently frozen, and there shall not be any others on the Closing Date.
J. Infectech has made available to Nutra Pharma all of its audited and
unaudited financial statements, all of its notes, mortgages and other
obligations and agreements and other instruments for or relating to any
borrowing effected by Infectech or to which any properties or assets of
Infectech is subject, leases and similar agreements under which Infectech is
subject, and a list of any and all contracts, agreements, and other instruments
material to the conduct of Infectech's business. Infectech has performed all
obligations required by it to be performed under the any of the foregoing, and
there has not occurred any event which with the passage of time or giving
notice or both would constitute a default.
K. Infectech has good and marketable title to the 32 medical patents
registered and pending in its name, and such patents have been duly maintained.
7. REPRESENTATIONS AND WARRANTIES OF NUTRA PHARMA
Nutra Pharma hereby represents and warrants as follows:
A. Nutra Pharma is a corporation duly formed and validly existing and in
good standing under the laws of the state of California, it has all necessary
corporate powers to own its properties and carry on its business as now owned
and operated by it, and is in good standing in every jurisdiction in which
failure to qualify would have a material adverse affect on its business and
financial condition, and has the corporate power to enter into and perform this
agreement, subject only to the approval of its shareholders. Such execution,
delivery and performance of this Agreement and all other instruments and
documents to be delivered hereunder have been duly authorized by all necessary
corporate action on the part of Nutra Pharma , and will not contravene or
violate or constitute a breach of the terms of either of its Articles of
Incorporation, founding documents, or By-Laws, or conflict with, result in a
breach of, or entitle any party to terminate or call a default with respect to
any instrument or decree to which either is bound or any contract or any
instrument, judgment, order, decree, law, rule or regulation applicable to it.
Nutra Pharma is not a party to, or subject to, or bound by any judgment,
injunction, or decree of any court or governmental authority or agreement which
may restrict or interfere with its performance of this Agreement. This
Agreement has been duly executed and delivered and constitutes, and the other
instruments and documents to be delivered by Nutra Pharma hereunder will
constitute, the valid and binding obligations of it, enforceable against it in
accordance with their respective terms.
C. Except as otherwise set forth herein, no consent of any party to any
contract or arrangement to which Nutra Pharma is a party or by which it is
bound is required for the execution, performance, or consummation of this
Agreement.
D. The representations and warranties contained in this Section will be
accurate, true and correct, in all respects, on and as of the date of Closing
as though made at such date in identical language.
E. All of Nutra Pharma 's assets are free and clear of security interests,
liens, pledges, charge and encumbrances, equities or claims, except those
obligations to shareholders and others as reported on its financial statements.
F. The shares of Nutra Pharma being transferred pursuant to this
agreement will be validly and legally issued and not subject to any security
interests, liens, pledges, charges, encumbrances or proxies of any kind.
G. Neither Nutra Pharma , nor any of its officers and directors has ever
been convicted of any felony or misdemeanor offense involving moral turpitude;
nor have they been the subject of any temporary or permanent restraining order
resulting from unlawful transactions in securities; nor are they now, or have
they ever been, a defendant in any lawsuit alleging unlawful business practices
or the unlawful sale of securities; nor have they been the debtor in any
proceedings, whether voluntary or involuntary, filed in the U.S. Bankruptcy
Court.
H. The authorized share capital of Nutra Pharma consists of 1 billion
(1,000,000,000) shares of common class stock, 45,634,500 of which are issued
and outstanding, and are owned, beneficially and of record by Nutra Pharma 's
shareholders and no other share capital of Nutra Pharma is issued and
outstanding. There are no subscriptions, options or other agreements or
commitments, obligating Nutra Pharma to issue any shares or securities
convertible into its shares at the date of this agreement, and there shall not
be any others on the Closing Date.
I. Nutra Pharma has made available to Infectech all of its reports on
file with the Securities and Exchange Commission, which reports reflect all of
its audited and unaudited financial statements, all of its notes, mortgages and
other obligations and agreements and other instruments for or relating to any
borrowing effected by Nutra Pharma or to which any properties or assets of
Nutra Pharma is subject, leases and similar agreements under which Nutra Pharma
is subject, and a list of any and all contracts, agreements, and other
instruments material to the conduct of Nutra Pharma 's business. Nutra Pharma
has performed all obligations required by it to be performed under the any of
the foregoing, and there has not occurred any event which with the passage of
time or giving notice or both would constitute a default.
J. The execution, delivery and performance of this agreement by Nutra
Pharma does not require the consent, waiver, approval, license or
authorizations of any person or public authority which has not been obtained,
does not violate, with or without the giving of notice or the passage of time
or both, any law applicable to Nutra Pharma , and does not conflict with or
result in a breach or termination of any provisions of, or constitute a default
under, or result in the creation of any lien, charge or encumbrance upon any of
the property or assets of Nutra Pharma .
K. Nutra Pharma has complied with all laws, ordinances, regulations and
orders which have application to its business, the violation of which might
have a material adverse effect on its financial condition or results of
operations, and possesses all governmental licenses and permits material to and
necessary for the conduct of its business, the absence of which might have a
material adverse effect on their respective financial condition or results of
operations. All such licenses and permits are in full force and effect, no
violations are or have been recorded in respect of any such licenses or
permits, and no proceeding is pending or threatened to revoke or limit any such
licenses or permits.
L. All of the representations and warranties herein made by Nutra Pharma
are applicable to it and to each of its subsidiaries as well.
M. There are no actions, suits, and proceedings pending or threatened
against or affecting Nutra Pharma or its respective properties, business, or
subsidiaries, at law or in equity and before or by any federal, state or other
governmental body or any arbitration board, domestic or foreign. Nutra Pharma
has no knowledge or notice of, any grounds for any other action, suit or
proceeding.
N. Nutra Pharma has no outstanding payables.
O. Infectech shall have received an opinion, dated the Closing Date, from
Nutra Pharma's legal counsel, which shall be in a form and substance
satisfactory to Infectech, as follows:
1. Nutra Pharma is a corporation, formed and duly organized,
validly existing and in good standing under the laws of the state of
California. Nutra Pharma has the corporate power to enter into and perform
this agreement. Nutra Pharma has the corporate power to own or lease its
properties and to carry on its business as now being conducted. The
capitalization of Nutra Pharma is as stated in such opinion, and all issued
and outstanding shares of Nutra Pharma are duly authorized, validly issued,
fully paid and non-assessable.
2. No provision of the founding documents or statutes of Nutra
Pharma , or of any mortgage, indenture, agreement, contract, or other
instrument known to such counsel to which Nutra Pharma is a party, will be
violated or breached by the performance of this agreement, or to the knowledge
of such counsel, requires the consent or authorization of any other person,
firm or corporation to this agreement or that, if required, such consent or
authorization has been obtained.
3. Except for the matters referred to in this Agreement or disclosed
in writing to Nutra Pharma prior to the date of this agreement, such counsel
knows of no materially adverse action, suit or proceeding pending or threatened
against Nutra Pharma , except that is specifically set forth in Exhibit 2
hereto.
4. Nutra Pharma has full power and authority to execute this
Agreement.
5. All corporate acts and other proceedings required to be taken by
Nutra Pharma to authorize the performance of this Agreement have been duly and
properly taken, except for the approval of Nutra Pharma 's shareholders,
pursuant to a duly noticed shareholder's meeting, which is required to
consummate this agreement. This agreement constitutes the legal, valid and
binding obligations of Nutra Pharma , enforceable in accordance with its terms,
except as the same may be limited by bankruptcy, insolvency, reorganization, or
other laws affecting the enforcement of creditors' rights generally from time
to time in effect.
8. CLOSING
Concurrently with the Closing, Nutra Pharma shall deliver certificates
representing the Nutra Pharma shares being transferred, upon the delivery of
the Infectech shares, with duly attached stock powers and third party releases,
complete with signature guarantees.
9. NOTICES
Any notices called for in this agreement shall be effective upon personal
service or upon service by first class mail, postage prepaid, to the parties at
such addresses to be designated by the parties in writing.
10. MISCELLANEOUS PROVISIONS:
This agreement shall be construed in accordance with the laws of the State
of California.
This agreement shall be binding upon and shall inure to the benefit of the
parties hereto, their beneficiaries, heirs, representatives, assigns, and all
other successors in interest.
Each of the parties shall execute any and all documents required to be
executed and perform all acts required to be performed in order to effectuate
the terms of this agreement.
This agreement contains all of the agreements and understandings of the
parties hereto with respect to the matters referred to herein, and no prior
agreement or understanding pertaining to any such matters shall be effective
for any purpose.
Each of the parties hereto has agreed to the use of the particular
language of the provisions of this Agreement, and any question of doubtful
interpretation shall not be resolved by any rule of interpretation against the
party who causes the uncertainty to exist or against the draftsman.
This agreement may not be superseded, amended or added to except by an
agreement in writing, signed by the parties hereto, or their respective
successors-in-interest.
Any waiver of any provision of this agreement shall not be deemed a waiver
of such provision as to any prior or subsequent breach of the same provision or
any other breach of any other provision of this agreement.
If any provision of this agreement is held, by a court of competent
jurisdiction, to be invalid, or unenforceable, said provisions shall be deemed
deleted, and neither such provision, its severance or deletion shall affect the
validity of the remaining provisions of this agreement, which shall,
nevertheless, continue in full force and effect.
The parties may execute this agreement in two or more counterparts, each
of which shall be signed by all of the parties; and each such counterpart shall
be deemed an original instrument as against any party who has signed it.
The parties shall use their reasonable best efforts to obtain the consent
of all necessary persons and agencies to the transfer of shares provided for in
this agreement.
Each party shall bear their own attorney's fees and costs with respect to
their due diligence and review of this Agreement. Nutra Pharma shall bear all
the costs associated with the acquisition of the shares, including any SEC
filings, state filings, and disclosures.
IN WITNESS WHEREOF, the parties have executed this agreement as of the day
and year first above written.
Nutra Pharma Corp.
Zirk Engelbrecht
By:
ZIRK ENGELBRECHT, Chairman and
Chief Financial Officer
Infectech Corporation
By: David McClelland, Sr.
------------------------------------
DAVID McCLELLAND, President/Treasurer
Shareholders:
Mitchell S. Felder, M.D.
------------------------
Mitchell S. Felder, M.D.
For the board of Directors: Vote 5 Yes; 0 No