Stock Purchase Agreement [Series B Convertible Preferred] - Odyssey Marine Exploration Inc., John C. Morris, Gregory P. Stemm and the MacDougald Family LP
ODYSSEY MARINE EXPLORATION, INC.
SERIES B CONVERTIBLE PREFERRED STOCK
PURCHASE AGREEMENT
Dated as of February 28, 2001
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ODYSSEY MARINE EXPLORATION, INC.
Series B Convertible Stock Purchase Agreement
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Series B Convertible Stock Purchase Agreement (this "Agreement") dated as
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of February 28, 2001 is entered into by and between Odyssey Marine Exploration,
Inc., a Nevada corporation (the "Company"), John C. Morris and Gregory P. Stemm
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(the "Founders"), and the MacDougald Family Limited Partnership, a Nevada
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limited partnership (the "Purchaser"). Certain capitalized terms used herein
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are defined in Section 10 of this Agreement.
WHEREAS, the Purchaser desires to purchase from the Company, and the
Company desires to sell to the Purchaser, certain shares of the Company's common
stock, $0.0001 par value per share ("Common Stock"), Series B Preferred Stock
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(defined below), and warrants to purchase additional shares of Common Stock in
the amounts and at the exercise prices set forth herein and therein;
WHEREAS, as an inducement and as a condition to entering into this
Agreement, the parties shall concurrently execute and deliver the Registration
Rights Agreement attached hereto as Exhibit E (the "Registration Rights
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Agreement"); and
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WHEREAS, the Board of Directors of the Company (the "Board of Directors")
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has determined that it is in the best interests of the Company to enter into
this Agreement and the Transaction Documents (as defined in Section 6.3 of this
Agreement);
NOW, THEREFORE, in consideration of the foregoing, and of the mutual
representations, warranties, covenants, and agreements herein contained, the
parties hereto agree as follows:
1. Authorization and Sale of Shares
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1.1 Authorization. The Company has duly authorized, and taken all such
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corporate and other action necessary for, the sale, issuance, and delivery of,
pursuant to the terms of this Agreement:
(a) an aggregate of Eight Hundred Sixty Four Thousand Eight
(864,008) shares of Common Stock;
(b) an aggregate of Eight Hundred Fifty Thousand (850,000) shares
of Series B Convertible Preferred Stock, $0.0001 par value per share
(the "Series B Preferred Stock"), having the rights, privileges, and
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preferences set forth in the Certificate of Designations attached
hereto as Exhibit A (the "Designations"), which Designations have been
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adopted by the Company and filed with the Secretary of State of the
State of Nevada; and
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(c) an aggregate of 1,889,000 warrants of the Company (the
"Warrants") to purchase shares of Common Stock, such Warrants to be
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issued pursuant to Warrant Agreements (as may be amended, restated, or
modified from time to time, the "Warrant Agreements") substantially in
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the forms attached hereto as Exhibit B, each Warrant evidencing the
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right to receive (subject to adjustment as provided in the Warrant
Agreement), upon payment of the exercise price therefor, one share of
Common Stock, exercisable upon the terms and conditions set forth in
such Warrants generally as follows:
(i) Seven Hundred Twenty Two Thousand (722,000) Warrants
to purchase shares of Common Stock at an exercise price of $3.00
through the expiration date of February 28, 2003;
(ii) One Hundred Twenty Thousand (120,000) Warrants to
purchase shares of Common Stock at an exercise price of $2.50
through the expiration date of March 31, 2002;
(iii) Eight Hundred Seventeen Thousand (817,000) Warrants to
purchase shares of Common Stock at an exercise price of $2.00
through the expiration date of February 28, 2003, and
(iv) Two Hundred Thirty Thousand (230,000) Warrants to
purchase shares of Common Stock at an exercise price of $0.30
through the expiration date of February 28, 2004.
1.2 Sale of Securities. Subject to the terms and conditions of this
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Agreement, Purchaser, and the Purchaser agrees to purchase, 864,008 shares of
Common Stock, 850,000 shares of Series B Preferred Stock, and Warrants to
purchase up to 1,889,000 shares of Common Stock (such Common Stock, Series B
Preferred Stock, and the Warrants to be purchased hereby, together, the
"Securities") for an aggregate purchase price of $3,000,000 (the "Purchase
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Price").
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1.3 Use of Proceeds. The Company will use the proceeds from the sale of
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the Shares for general working capital needs.
2. The Closing. The closing (the "Closing") of the sale and purchase of the
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Securities under this Agreement shall take place at the offices of Carlton
Fields, P.A., One Harbour Place, 777 South Harbour Island Boulevard, Tampa,
Florida, at 5:00 p.m. on February 28, 2001. At the Closing, the Company shall
deliver to the Purchaser certificates for the number of shares of Common Stock,
Preferred Stock, and Warrants being purchased by the Purchaser at the Closing,
registered in the name of the Purchaser, against payment to the Company of the
Purchase Price, by certified or bank cashier's check or by wire transfer as
specified by the Company in writing. The date of the Closing is hereinafter
referred to as the "Closing Date." If at the Closing any of the conditions
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specified in Section 6 shall not have been met, the Purchaser shall, at its
election, be relieved of all of its obligations under this Agreement without
thereby waiving any other rights it may have by reason of such failure or such
non-fulfillment.
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3. Representations of the Company. Except as disclosed by the Company in
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Exhibit C hereto, or in any of the Company's disclosure documents on file with
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the Securities and Exchange Commission, the Company hereby represents and
warrants to the Purchaser that the statements contained in this Section 3 are
true, complete and correct. Exhibit C shall be arranged in paragraphs
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corresponding to the numbered and lettered paragraphs contained in this Section
3, and the disclosures in any paragraph of Exhibit C shall qualify all of the
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representations and warranties of this Section 3.
3.1 Organization and Standing. The Company is a corporation duly
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organized, validly existing and in good standing under the law of the State of
Nevada and has full corporate power and authority to conduct its business as
presently conducted and as proposed to be conducted by it and to enter into and
perform this Agreement and all other agreements required to be executed by the
Company at or prior to the Closing pursuant to Section 6.3 (the "Transaction
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Documents") and to carry out the transactions contemplated by this Agreement and
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the Transaction Documents. The Company is duly qualified to do business as a
foreign corporation in every other jurisdiction in which the failure so to
qualify would have a material adverse effect on the business, prospects, assets
or condition (financial or otherwise) of the Company (a "Material Adverse
----------------
Effect"). The Company has furnished to the Purchaser true and complete copies of
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its Articles of Incorporation and Bylaws, each as amended to date and presently
in effect. To the Company's knowledge, it has at all times complied with all
provisions of its Articles of Incorporation and Bylaws and is not in default
under, or in violation of, any such provision.
3.2 Capitalization. The authorized capital stock of the Company
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(immediately prior to the Closing) consists of: (a) One Hundred Million
(100,000,000) shares of Common Stock, of which 16,776,171 shares are issued and
outstanding and 4,888,518 shares have been reserved for issuance pursuant to
outstanding warrants, options, and the Employee Stock Option Plan of the
Company, and (b) Ten Million (10,000,000) shares of Preferred Stock, $.0001 par
value per share, "Preferred Stock"), of which (x) 700,000 shares have been
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designated as Series A Preferred Stock, 190,000 of which shares were issued but
none of which are currently outstanding and (y) of which 850,000 have been
designated as Series B Preferred Stock, none of which are issued or outstanding.
The rights, privileges, and performances of the Series B Preferred Stock are as
stated in the Designations. All of the issued and outstanding shares of Common
Stock and Preferred Stock have been duly authorized and validly issued and are
fully paid and nonassessable. Except for the Securities to be sold and issued as
provided in this Agreement, (i) no subscription, warrant, option, or other right
(written or oral, or contingent or otherwise) to purchase or acquire any shares
of, or any security directly or indirectly convertible in or exchangeable or
exercisable for, any capital stock of the Company is authorized or outstanding,
(ii) the Company has no obligation (contingent or otherwise) to issue any
subscription, warrant, option, convertible security or other such right or to
issue or distribute to holders of any shares of its capital stock any evidences
of indebtedness or assets of the Company, (iii) the Company has no obligation
(contingent or otherwise) to purchase, redeem or otherwise acquire any shares of
its capital stock or any interest therein or to pay any dividend or make any
other distribution in respect thereof, (iv) there are no outstanding or
authorized stock appreciation, phantom stock, or similar rights with respect to
the Company, and (v) there are no voting agreements or similar arrangements
among the Company or any of its stockholders. All of the issued and outstanding
shares of capital stock of the Company
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have been offered, issued, and sold by the Company in compliance with all
applicable federal and state securities laws.
3.3 Subsidiaries. Except as detailed in the Company's Form 10-KSB dated
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February 29, 2000, the Company has no subsidiaries and does not own or control,
directly or indirectly, any shares of capital stock of any other corporation or
any interest in any partnership, joint venture or other non-corporate business
enterprise.
3.4 Securityholder Lists and Agreements. The Company has furnished the
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Purchaser with a list of the common stockholders of the Company, as provided by
the Company's transfer agent, showing the number of shares of Common Stock held
by each known stockholder as of the date of the report. Exhibit C contains a
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true and complete list of all other outstanding securities issued by the Company
including options, warrants, and other securities directly or indirectly
convertible into or exchangeable or exercisable for any capital stock of the
Company, the exercise or conversion price thereof, and the number and type of
securities issuable thereunder. Except as provided in this Agreement and the
Exhibits hereto, there are no agreements, written or oral, between the Company
and any holder of its securities, or, to the best of the Company's knowledge,
among any holders of its securities, relating to the acquisition (including
without limitation rights of first refusal, anti-dilution or pre-emptive
rights), or disposition. There are no rights outstanding which permit or allow
the holder thereof to cause the Company to file a registration statement under
the Securities Act or which permit or allow the holder thereof to include
securities of the Company in a registration statement filed by the Company.
3.5 Issuance of Securities. The issuance, sale, and delivery of the
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Securities in accordance with this Agreement, and the issuance and delivery of
the shares of Common Stock issuable upon conversion of the Series B Preferred
Stock and exercise of the Warrants, have been, duly authorized by all necessary
corporate action on the part of the Company, including its Board of Directors
and its stockholders, and all such shares have been duly reserved for issuance.
The Securities, when so issued, sold, and delivered against payment therefor in
accordance with the provisions of this Agreement, and the shares of Common Stock
issuable upon conversion of the Series B Preferred Stock and upon exercise of
the Warrants, when issued upon such conversion, or exercise, shall be duly and
validly issued, fully paid, and nonassessable, and shall be free and clear of
any liens, encumbrances, security interests, charges, or restrictions ("Liens"),
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or pre-emptive or other similar rights.
3.6 Authority for Agreement; No Conflict. The execution, delivery, and
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performance by the Company of this Agreement and the Transaction Documents, and
the consummation by the Company of the transactions contemplated hereby and
thereby, have been duly authorized by all necessary corporate action. This
Agreement has been, and the Transaction Documents when executed at the Closing
will be, duly executed and delivered by the Company and constitute valid and
binding obligations of the Company enforceable in accordance with their
respective terms, subject as to enforcement of remedies to applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
generally the enforcement of creditors' rights and subject to a court's
discretionary authority with respect to the granting of a decree ordering
specific performance or other equitable remedies. The execution of and
performance of the transactions
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contemplated by this Agreement and the Transaction Documents and compliance with
their respective provisions by the Company will not: (a) conflict with or
violate any provision of the Articles of Incorporation or By-laws of the
Company, (b) conflict with, result in a breach of, constitute (with or without
due notice or lapse of time or both) a default under, results in the
acceleration of, create in any party the right to accelerate, terminate, modify
or cancel, or require any notice, consent or waiver under, any contract, lease,
sublease, license, sublicense, franchise, permit, indenture, agreement or
mortgage for borrowed money, instrument of indebtedness, Security Interest (as
defined below) or other arrangement to which the Company is a party or by which
the Company is bound or to which its assets are subject, other than any of the
foregoing events listed in this Section 3.6(c) which do not and will not,
individually or in the aggregate, have a Material Adverse Effect, (c) result in
the imposition of any Security Interest upon any assets of the Company, or (d)
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to the Company or any of its properties or assets. For purposes of
this Agreement, "Security Interest" means any mortgage, pledge, security
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interest, encumbrance, charge, or other lien (whether arising by contract or by
operation of law).
3.7 Governmental Consent. No consent, approval, order, or authorization
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of, or registration, qualification, designation, declaration, or filing with,
any court, arbitration tribunal, administrative agency, commission, or other
governmental authority or instrumentality (each hereafter referred to as a
"Governmental Entity") is required on the part of the Company in connection with
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the execution and delivery of this Agreement or the Transaction Documents, the
offer, issuance, sale and delivery of the Securities, the issuance and delivery
of the shares of Common Stock issuable upon conversion of the Series B Preferred
Stock or upon exercise of the Warrants or the other transactions to be
consummated at the Closing, as contemplated by this Agreement and the
Transaction Documents, except such filings as shall have been made prior to and
shall be effective on and as of the Closing and such filings required to be made
after the Closing under applicable federal and state securities laws, all of
which filings are specified in Exhibit C. Based on the representations made by
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the Purchaser in Section 5 of this Agreement, the offer and sale of the
Securities to the Purchaser and the Common Stock issuable upon conversion of the
Series B Preferred Stock or upon exercise of the Warrants, will be in compliance
with applicable federal and state securities laws, including the registration
provisions thereunder.
3.8 Litigation. There is no action, suit or proceeding, or governmental
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inquiry or investigation, pending, or, to the best of the Company's knowledge,
any basis therefor or threat thereof, against the Company or the Founders, which
questions the validity of this Agreement or the right of the Company or the
Founders to enter into it, or which might result, either individually or in the
aggregate, in a Material Adverse Effect, nor is there any litigation pending,
or, to the best of the Company's knowledge, any basis therefor or threat
thereof, against the Company or the Founders by reason of the past employment
relationships of the Founders, the proposed activities of the Company, or
negotiations by the Company and/or the Founders with possible investors in the
Company. The Company is not subject to any outstanding judgement, order, or
decree.
3.9 Compliance. The Company is in compliance with, and in all material
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respects has complied with, all laws, regulations, and orders applicable to its
present and proposed business and has all material permits and licenses required
thereby. There is no term or provision of any
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mortgage, indenture, contract, agreement, or instrument to which the Company is
a party or by which it is bound, or of any provision of any state or federal
judgment, decree, order, statute, rule or regulation applicable to or binding
upon the Company, which materially adversely affects or, in the future is
reasonably likely to result in or have a Material Adverse Effect. To the best of
the Company's knowledge, neither the Founders nor any other employee of the
Company is in violation of any term of any contract or covenant (either with the
Company or with another entity) relating to employment, patents, assignment of
inventions, proprietary information disclosure, non-competition, or non-
solicitation.
3.10 Employees. All employees of the Company who have access to
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confidential or proprietary information of the Company have executed and
delivered Employment agreements which contain nondisclosure/non-competition
agreements, and all of such agreements are in full force and effect. The Company
is not aware that any employee of the Company has plans to terminate his or her
employment relationship with the Company. The Company, to the best of its
knowledge, has complied in all material respects with all applicable laws
relating to wages, hours, equal opportunity, collective bargaining, workers'
compensation insurance and the payment of social security and other taxes. None
of the employees of the Company is represented by any labor union, and there is
no labor strike or other labor trouble pending with respect to the Company
(including, without limitation, any organizational drive) or, to the best of the
Company's knowledge, threatened.
3.11 Financial Statements and SEC Documents.
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(a) The Company has prepared and furnished to the
Purchaser the audited balance sheets of the Company as of the end of the fiscal
years ending February 28, 1998, February 28, 1999 and February 29, 2000, and the
audited statements of operations, shareholders' equity, and statement of cash
flow for each of such fiscal years, each accompanied by the related report of
Giunta, Ferlita & Walsh, P.A. independent certified public accountants. The
Company also has prepared and furnished to the Purchaser, the unaudited balance
sheets of the Company as of the end of each quarter of the Company ending after
February 29, 2000 and the unaudited statements of operations and statements of
cash flow for the respective quarters then ended. All of the financial
statements, including, without limitation, the notes thereto, referred to in
this Section 3.11: (a) are in accordance with the books and records of the
Company, (b) present fairly the financial position of the Company as of the
dates and the results of operations and changes in financial position for the
periods indicated, and (c) have been prepared in accordance with generally
accepted accounting principles applied on a basis consistent with prior
accounting periods. Exhibit C sets forth all changes in accounting methods (for
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financial accounting purposes) at any time made, agreed to, requested, or
required with respect to Company.
(b) The Company has filed and provided to the Purchaser a
true and complete copy of each report, schedule, registration statement and
definitive proxy statement filed by the Company with the Securities and Exchange
Commission ("SEC") since March 1, 1998 (the "SEC Documents") which are all the
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documents that the Company was required to file with the SEC since such date. As
of their respective dates, each of the SEC Documents complied in all material
respects with the requirements of the Securities Act or the Securities Exchange
Act of
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1934, as amended, (the "Exchange Act"), as the case may be, and the rules
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and regulations of the SEC thereunder applicable to such SEC Documents, and, to
the Company's knowledge, none of the SEC Documents contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with the published rules and regulations of the SEC with
respect thereto, have been prepared in accordance with GAAP (except as may be
indicated in the notes thereto or, in the case of the unaudited statements, as
permitted by Rule 10-01 of Regulation S-X of the SEC) and fairly present in
accordance with applicable requirements of GAAP (subject, in the case of the
unaudited statements, to normal, recurring adjustments, none of which were
material) the financial position of the Company and its subsidiaries, if any, as
of their respective dates and the results of operations and the cash flows of
the Company for the periods presented therein. The Company has no material
liability or obligation of a type which would be included in a balance sheet
prepared in accordance with GAAP whether related to tax or non-tax matters,
accrued or contingent, due or not yet due, liquidated or unliquidated, or
otherwise, except and to the extent disclosed or reflected in the financial
statements included in the SEC Documents.
3.12 No Liabilities. Except as reflected in the financial statements
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furnished pursuant to this Agreement or as described in Exhibit C, there are no
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material liabilities of the Company. Except as described in Exhibit C, since
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November 30, 2000: (a) the Company has not incurred any material liabilities
(whether contingent or absolute, matured or unmatured, or known) other than in
the ordinary course of business, and (b) there have been no events, changes,
developments, or occurrences that have had, or which would have, individually or
in the aggregate, a Material Adverse Effect on the Company.
3.13 Taxes. The Company has duly filed all tax returns required to
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be filed by the Company on or before the Closing Date with respect to all
applicable taxes. No material penalties or other charges are or will become due
with respect to any of tax returns as the result of the late filing thereof. To
the best of the Company's knowledge, all of the Company's tax returns are true
and complete in all respects. The Company (i) has paid all taxes due or claimed
to be due by any taxing authority in connection with any of the Company's tax
returns (without regard to whether or not such taxes are shown as due on such
tax returns), or (ii) have established in financial statements provided to the
Purchaser adequate reserves (in conformity with generally accepted accounting
principles consistently applied) for the payment of such taxes. The amounts set
up as reserves for taxes on the financial statements of Company furnished to the
Purchaser are sufficient for the payment of all unpaid taxes, whether or not
such taxes are disputed or are yet due and payable, for or with respect to the
period, and for which the Company may be liable or as a transferee of the assets
of, or successor to, any corporation, person, association, partnership, joint
venture, or other entity. There is no action, suit, proceeding, audit,
investigation, or claim pending or, to the knowledge of the Company, threatened
in respect of any taxes for which the Company is or may become liable, nor has
any deficiency or claim for any such taxes been proposed, asserted or, to the
knowledge of the Company, threatened. The Company has not consented to any
waivers or extensions of any statute of limitations with respect to any taxable
year of the Company. There is no agreement, waiver, or consent providing for an
extension of time
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with respect to the assessment or collection of any taxes against the Company,
and no power of attorney granted by the Company with respect to any tax matters
is currently in force.
3.14 Real Property. The Company has not owned and does not own any
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real property.
3.15 Assets. The Company has good, valid, and marketable title
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to all assets owned by it, including, without limitation, all assets reflected
in the balance sheets furnished to the Purchaser and all Assets purchased by the
Company since February 29, 2000 (except for assets reflected in such balance
sheets or acquired since February 29, 2000, that have been sold or otherwise
disposed of in the ordinary course of business), free and clear of all Liens.
All personal property of the Company is in good operating condition and repair
and is suitable and adequate for the uses for which it is intended or is being
used.
3.16 Insurance. Exhibit C lists and briefly describes all
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policies of title, asset, fire, hazard, casualty, liability, life, worker's
compensation and other forms of insurance of any kind owned or held by the
Company. All such policies: (a) are with insurance companies reasonably
believed by the Company to be financially sound and reputable; (b) are in full
force and effect; (c) are sufficient for compliance by the Company with all
requirements of law and of all agreements to which the Company is a party; (d)
are valid and outstanding policies enforceable against the insuror; (e) insure
against risks of the kind customarily insured against and in amounts customarily
carried by companies similarly situated and by companies engaged in similar
businesses and owning similar properties, and provide adequate insurance
coverage for the businesses and assets of the Company; and (f) provide that they
will remain in full force and effect through the respective dates set forth in
Exhibit C.
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3.17 Intellectual Property. The Company has no knowledge, and has
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received no notice to the effect that it has, or is claimed to have, infringed
any intellectual property or legally protectable right of another.
3.18 Debt Instruments. Exhibit C lists and briefly describes the
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material terms, provisions, and conditions of all mortgages, indentures, notes,
guarantees, and other agreements for or relating to borrowed money (including,
without limitation, conditional sales agreements and capital leases) to which
the Company is a party or which has been assumed by the Company or to which any
assets of the Company are subject and, with respect to each arrangement so
listed, briefly describes the principal amount, interest rate, original and
maturity dates and any sinking fund installments, prepayment premiums,
restrictive covenants, and any other material provisions. Exhibit C lists and
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briefly describes the materials terms, provisions, and conditions of all
guarantees made by any of the shareholders guaranteeing any obligation of the
Company. The Purchaser will not become a guarantor of any obligation of the
Company as a result of the transactions contemplated by this Agreement and
specifically, as a result of its status as a shareholder of the Company. The
Company has performed all the obligations required to be performed by it to date
and is not in default in any respect under any of the foregoing, and there has
not occurred any event which (whether with or without notice, lapse of time or
the happening or occurrence of any other event) would constitute such a default.
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3.19 Other Agreements. Except as disclosed and briefly described
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in Exhibit C, all material contracts, agreements, leases, commitments, and other
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instruments to which the Company is a party or by which the Company is bound at
the date hereof and which are required to be filed as an exhibit to the SEC
Documents have been so filed.
3.20 Books and Records. The books of account, share records,
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minute books, and other records of the Company are true and complete and have
been maintained in accordance with good business practices, and the matters
contained therein are appropriately and accurately reflected in the financial
statements of the Company furnished to the Purchaser.
3.21 Pension and Benefit Plans. The Company's only benefit plan
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consists of health insurance paid by the Company for its employees.
3.22 Environmental.
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(a) The Company has complied and is materially in
compliance with all Environmental Laws (as defined below).
(b) The Company has no material liability under any
Environmental Law. There are no pending or to the knowledge of the Company
threatened actions, suits, claims, legal proceedings, or other proceedings based
on, and the Company, no officer, director, or shareholder of the Company has
received any formal or informal notice of any complaint, order, directive,
citation, notice of responsibility, notice of potential responsibility, or
information request from any governmental authority or any other person or
entity or knows or suspects any fact(s) that might form the basis for any such
actions or notices arising out of or attributable to: (i) the off-site disposal
or treatment of Hazardous Materials (as defined below) originating on or from
the business or assets of the Company; (ii) any facility operations, procedures,
or designs of the Company that do not conform to requirements of the
Environmental Laws; or (iii) any violation of Environmental Laws arising from
the Company's activities involving Hazardous Materials.
(c) To the best of its knowledge, the Company has been duly
issued, and currently has and will maintain through the Closing Date, all
permits, licenses, certificates, and approvals required under any Environmental
Law. A true and complete list of such permits, licenses, certificates, and
approvals, all of which are valid and in full force and effect, is set out in
Exhibit C. Except in accordance with such permits, licenses, certificates, and
approvals, there has been no release or discharge of any other material
regulated by such permits, licenses, certificates, or approvals.
3.23 Disclosures. Neither this Agreement nor any Exhibit hereto, nor
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any report, certificate or instrument furnished to the Purchaser in connection
with the transactions contemplated by this Agreement, when read together with
the SEC Documents, contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary in order to make
the statements contained herein or therein, in light of the circumstances under
which they were made, not misleading.
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4. Representations of Founders. The Founders, jointly and severally, represent
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and warrant to the Purchaser as follows:
4.1 Conflicting Agreements. The Founders are not and will not be as of the
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date of the Closing, as a result of the nature of the business conducted or
proposed to be conducted by the Company or for any other reason, in violation of
(i) any fiduciary or confidential relationship, (ii) any term of any contract or
covenant (either with the Company of with another entity) relating to
employment, patents, assignment of inventions, proprietary information
disclosure, non-competition or non-solicitation, or (iii) any other contract or
agreement, or any judgment, decree or order of any court or administrative
agency, relevant to or affecting the right of the Founders to be employed by the
Company. No such relationship, term, contract, agreement, judgment, decree, or
order conflicts with the Founders' obligations to use their best efforts to
promote the interests of the Company nor does the execution and delivery of this
Agreement, nor the carrying on of the Company's business as an officer or key
employee of the Company, conflict with any such relationship, term, contract,
agreement, judgment, decree or order.
4.2 Litigation. There is no action, suit or proceeding, or governmental
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inquiry or investigation, relevant to the Company's business, pending or, to the
best of the Founders' knowledge, threatened against the Founders, and, to the
best of the Founders' knowledge, there is no basis for any such action, suit,
proceeding, or governmental inquiry or investigation.
4.3 Stockholder Agreements. Except as contemplated by or disclosed in this
----------------------
Agreement, the Founders are not a party to and have no knowledge of any
agreement, written or oral, relating to the acquisition, disposition,
registration under the Securities Act, or voting of the securities of the
Company, including, without limitation, agreements to which they are a party.
4.4 Representations and Warranties of the Company. To the best of the
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Founders' knowledge, the representations and warranties of the Company set forth
in Section 3 are true and correct.
5. Representations of the Purchaser. The Purchaser represents and warrants
--------------------------------
Company as follows:
5.1 Investment. The Purchaser is acquiring the Securities, and the shares
----------
of Common Stock into which the Series B Preferred Stock may be converted or
which may be acquired upon exercise of the Warrants, for its own account for
investment and not with a view to, or for sale in connection with, any
distribution thereof, nor with any present intention of distributing or selling
the same, and, except as contemplated by this Agreement and the Exhibits hereto,
the Purchaser has no present or contemplated agreement, undertaking,
arrangement, obligation, indebtedness or commitment providing for the
disposition thereof. The Purchaser is an "accredited investor" as defined in
Rule 501(a) under the Securities Act.
5.2 Authority. The Purchaser has full power and authority to enter in to
---------
and to perform this Agreement in accordance with its terms. The Purchaser
represents that it has not been organized, reorganized or recapitalized
specifically for the purpose of investing in the Company.
10
<PAGE>
5.3 Experience. The Purchaser has carefully reviewed the representations
----------
concerning the Company contained in this Agreement, the SEC Documents, and has
made detailed inquiry concerning the Company, its business and its personnel;
the officers of the Company have made available to the Purchaser any and all
written information which it has requested and have answered to the Purchaser's
satisfaction all inquiries made by the Purchaser; and the Purchaser has
sufficient knowledge and experience in finance and business that it is capable
of evaluating the risks and merits of its investment in the Company and the
Purchaser is able financially to bear the risks thereof. The Purchaser has been
represented by counsel or other advisors of his choosing.
6. Conditions to the Obligations of the Purchaser. The obligation of the
----------------------------------------------
Purchaser to purchase the Securities at the Closing is subject to the
fulfillment, or the waiver by the Purchaser, of each of the following conditions
on or before the Closing,
6.1 Accuracy of Representations and Warranties. Each representation and
------------------------------------------
warranty contained in Sections 3 and 4 of this Agreement shall be true on and as
of the Closing Date with the same effect as though such representation and
warranty had been made on and as of that date.
6.2 Performance. The Company and the Founders shall have performed and
-----------
complied with all agreements and conditions contained in this Agreement required
to be performed or complied with by the Company or the Founders prior to or at
the Closing.
6.3 Transaction Documents.
---------------------
(a) Registration Rights Agreement. The Registration Rights
-----------------------------
Agreement shall have been executed and delivered by the Company and the
Purchaser.
6.4 Compliance Certificates. The Company shall have delivered to the
-----------------------
Purchaser:
(a) a certificate, dated as of the Closing Date, signed on behalf of
the Company by the chief executive officer and the chief financial officer of
the Company to the effect that the conditions specified in Sections 6.1, 6.2,
6.6, 6.7 and 6.8 of this Agreement have been satisfied; and
(b) copies of all documents that the Purchaser may reasonably request
relating to the existence of the Company and certified copies of resolutions or
written consents duly adopted by the Company's Board of Directors evidencing the
taking of all corporate action necessary to authorize the execution, delivery,
and performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as the Purchaser and its
counsel shall request.
6.5 Opinion of Counsel. The Purchaser shall have received from counsel
------------------
to the Company an opinion in form and substance reasonably satisfactory to the
Purchaser, addressed to the Purchaser and dated as of the Closing Date.
6.6 Consents. The Company: (a) shall have secured all contractual and
--------
other third party consents, including without limitation, any consent required
from the holders of the Series A Preferred Stock, required in connection with
the transactions contemplated by this Agreement in form and substance
satisfactory to the Purchaser, and (b) the Company shall have made or obtained
11
<PAGE>
all consents of, filings or registrations with, and notifications to, all
Governmental Entities required for consummation of the transactions contemplated
hereby, including without limitation, those required under all applicable
federal and state securities laws, and which shall be in full force and effect
and all waiting periods required by law shall have expired.
6.7 No Pending Actions. No action, suit or proceeding shall be pending
------------------
before any court or quasi-judicial or administrative agency of any federal,
state or foreign jurisdiction or before any arbitrator wherein an unfavorable
injunction, judgment, order, decree, ruling or charge would (a) prevent
consummation of any of the transactions contemplated by this Agreement, (b)
cause any of the transactions contemplated by this Agreement to be rescinded
following consummation, (c) affect adversely the right of the Purchaser to
acquire the Securities, or (d) affect adversely the business, assets,
properties, operation (financial or otherwise) or prospects of the Company (and
no such injunction, judgment, order, decree, ruling or charge shall be in
effect).
6.8 No Material Adverse Change. Since August 31, 2000, there shall not
--------------------------
have been any material adverse change in the financial condition, results of
operations, business, business prospects, personnel, assets or liabilities
(contingent or otherwise) of the Company, except in the normal course of
business.
6.9 Other Matters. All corporate and other proceedings in connection with
-------------
the transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be reasonably satisfactory in
substance and form to the Purchaser, and the Purchaser shall have received all
such counterpart originals or certified or other copies of such documents as it
may reasonably request.
7. Condition to the Obligations of the Company. The obligations of the
-------------------------------------------
Company to perform this Agreement and to purchase the Securities are subject to
fulfillment, or the waiver, of the following condition on or before the Closing:
7.1 Accuracy of Representations and Warranties. The representations and
------------------------------------------
warranties of the Purchaser contained in Section 5 hereof shall be true on and
as of the Closing Date with the same effect as though such representations and
warranties had been made and as of that date.
8. Affirmative Covenants of the Company.
------------------------------------
8.1 Inspection and Observation. The Company shall permit the Purchaser,
--------------------------
or any authorized representative thereof, to visit and inspect the properties of
the Company, including its corporate and financial records, and to discuss its
business and finances with officers of the Company, during normal business hours
following reasonable notice and as often as may be reasonably requested. If at
any time while (a) the Purchaser holds any Securities, or any shares of Common
Stock in which the Securities may be converted or acquired upon exercise
thereof, and (b) no designee of the Purchaser is a member of the board of
directors of the Company, a representative of the Purchaser shall have the right
to notice of, and the right to attend, all meetings of the Company's board of
directors.
8.2 Operation of Business of Company.
--------------------------------
12
<PAGE>
(a) The Company shall, through the Closing Date: (i) preserve its
business organizations and its present relationships with customers, suppliers,
consultants, employees, and any other persons having business relations with it;
and (ii) maintain its assets in customary repair and condition.
(b) Except as contemplated by this Agreement or as reasonably required
to carry out its obligations hereunder, the Company shall, through the Closing
Date, conduct its business only in the ordinary course of business and, in
addition, not: (i) issue any capital shares or any options, warrants, or other
rights to subscribe for or purchase any of its capital shares or any securities
convertible into or exchangeable for its capital shares; (ii) declare, set
aside, or pay any dividend or distribution with respect to its capital shares;
(iii) directly or indirectly redeem, purchase, or otherwise acquire any of its
capital shares; (iv) effect a split, reclassification, or other change in or of
any of its capital shares; (v) amend its Articles of Incorporation or Bylaws
(except for such changes and amendments in the Articles of Incorporation of the
Company as may be required by this Agreement); (vi) grant any increase in the
compensation payable or to become payable by the Company to its officers or
employees or enter into any bonus insurance, pension, or other benefit plan,
payment, or arrangement for or with any of such officers or employees other than
in the ordinary course of business; (vii) borrow or agree to borrow any funds or
directly or indirectly guarantee or agree to guarantee the obligations of
others; (viii) enter into any agreement that may have a Material Adverse Effect;
(ix) place, or allow to be placed, an encumbrance on any of its assets; (x)
cancel any indebtedness owing to the Company or any claims that the Company may
possess, or waive any rights of substantial value; (xi) sell, assign, or
transfer any intellectual property; (xii) sell or otherwise dispose of any
interest in any asset, other than in the ordinary course of business, and (xiii)
violate any law; (xiv) commit any act or omit to do any act, or engage in any
activity or transaction or incur any obligation (by conduct or otherwise), which
(individually or in the aggregate) reasonably could be expected to have a
Material Adverse Effect; or (xv) make any loan or advance to any shareholder,
officer, or director of the Company or to any other person, firm, or
corporation. Prior to the Closing Date, the Company (i) will not do or agree to
do any of the things listed in clauses (i) through (xv) of this Section 8.2(b),
and (ii) will maintain all insurance as currently maintained.
(c) The Company shall notify the Purchaser promptly of any material
adverse change in its business, operations, prospects, condition (financial or
otherwise), assets, or liabilities, including, without limitation, copies of all
documents relating thereto) concerning all claims instituted, threatened, or
asserted again or affecting the Company or its business or assets at law, in
equity, or admiralty, before or by any court or Governmental Entity.
(d) The Company shall keep proper books of record and account in which
true and complete entries will be made of all transactions in accordance with
generally accepted accounting principles applied on a basis consistent with
prior periods.
8.3 Financial Statements and Other Information. The Company shall
------------------------------------------
deliver to the Purchaser so long as it holds any of the Securities or any shares
of the Common Stock into which the Securities may be converted or acquired upon
exercise thereof:
13
<PAGE>
(a) within 90 days after the end of each fiscal year of the Company, a
balance sheet of the Company as at the end of such year and statements of income
and of cash flows of the Company for such year;
(b) within 45 days after the end of each fiscal quarter of the Company
(other than the fourth quarter), an unaudited balance sheet of the Company as at
the end of such quarter, and unaudited statements of income and of cash flows of
the Company for such fiscal quarter and for the current fiscal year to the end
of such fiscal quarter;
(c) as soon as available, but in any event prior to the commencement
of each new fiscal year, a business plan and projected financial statements for
such fiscal year; and
(d) such other notices, information and data with respect to the
Company as the Company delivers to the holders of its capital stock at the same
time it delivers such items to such holders; and with reasonable promptness,
such other information and data as the Purchaser may from time to time
reasonably request.
8.4 Material Changes and Litigation. The Company shall promptly notify
-------------------------------
the Purchaser of any material adverse change in the business, prospects, assets
or condition, financial or otherwise, of the Company and of any litigation or
governmental proceeding or investigation brought or, to the best of the
Company's knowledge, threatened against the Company, or against any Founder,
officer, director, key employee or principal stockholder of the Company which,
if adversely determined, would have a Material Adverse Effect.
8.5 Agreements with Employees. The Company shall require all persons now
-------------------------
or hereafter employed by the Company who have access to confidential and
proprietary information of the Company to enter into a nondisclosure/non-
competition agreement, or an employment agreement which contains
nondisclosure/non-competition agreements.
8.6 Directors.
---------
(a) The Company shall promptly reimburse in full each director of the
Company who is not an employee of the Company and who was elected a director
solely or in part by the holders of the Shares for all of his reasonable out-of-
pocket expenses incurred in attending each meeting of the board of directors of
the Company or any committee thereof.
(b) The Board of Directors of the Company shall meet on at least a
quarterly basis unless otherwise agreed by a majority of the members of the
board of directors who are not employees of the Company or a subsidiary of the
Company.
(c) The Company shall provide directors' and officers' liability
insurance for all directors of the Company elected by holders of the Series B
Preferred Stock for such reasonable amounts as may be determined by the
Purchaser or at the Company's option, a specific indemnification from liability,
in such form as is reasonably acceptable to the Purchaser, for such elected
directors.
14
<PAGE>
8.7 Reservation of Common Stock. The Company shall reserve and maintain a
---------------------------
sufficient number of shares of Common Stock for issuance upon (a) conversion of
all of the outstanding Series B Preferred Stock, and (b) exercise of the
Warrants.
8.8 Related Party Transactions; Options.
-----------------------------------
(a) The Company shall not enter into any agreement with any officer or
director of the Company, or any "affiliate" or "associate" of such persons (as
such terms are defined in the rules and regulations promulgated under the
Securities Act), including without limitation any agreement or other arrangement
providing for the furnishing of services by, rental of real or personal property
from, or otherwise requiring payments to, any such person or entity, without the
consent of at least a majority of the members of the Company's Board of
Directors having no interest in such agreement or arrangement.
(b) The affirmative vote of both a majority of the members of the
board of directors, and the directors elected solely by the holders of the
Shares, shall be required to (i) establish or increase the compensation of
executive officers of the Company or (ii) grant stock options to any person.
9. Transfer of Securities.
----------------------
9.1 Restricted Shares. "Restricted Shares" means (i) the Securities,
-----------------
(ii) the shares of Common Stock issued or issuable upon conversion of the Series
B Preferred Stock or upon exercise of the Warrants, (iii) any shares of capital
stock of the Company acquired by the Purchaser pursuant to the Co-Sale
Agreement, and (iv) any other shares of capital stock of the Company issued in
respect of such shares (as a result of stock splits, stock dividends,
reclassifications, recapitalizations, or similar events); provided, however,
-------- -------
how that shares of Common Stock which are Restricted Shares shall cease to be
Restricted Shares: (x) upon any sale pursuant to a registration statement under
the Securities Act, Section 4(1) of the Securities Act, or Rule 144 under the
Securities Act or (y) at such time as they become eligible for sale under Rule
144(k) under the Securities Act.
9.2 Requirements for Transfer
-------------------------
(a) Restricted Shares shall not be sold or transferred unless either
(i) they first shall have been registered under the Securities Act, or (ii) the
Company first shall have been furnished with an opinion of legal counsel,
reasonably satisfactory to the Company, to the effect that such sale or transfer
is exempt from the registration requirements of the Securities Act.
(b) Notwithstanding the foregoing, no such registration or opinion of
counsel shall be required for (i) a transfer by the Purchaser to a partner of
the Purchaser or a withdrawn partner of the Purchaser who withdraws after the
date hereof, or to the estate of any such partner or withdrawn partner; provided
that the transferee in each case agrees in writing to be subject to the terms of
this Section 9 to the same extent as if it were the original Purchaser
hereunder, or (ii) a transfer made in accordance with Rule 144 under the
Securities Act.
15
<PAGE>
9.3 Legend. Each certificate representing Restricted Shares shall bear a
------
legend substantially in the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not
be offered, sold or otherwise transferred, pledged or hypothecated
unless and until such shares are registered under such Act or an
opinion of counsel satisfactory to the Company is obtained to the
effect that such registration is not required."
The foregoing legend shall be removed from the certificates representing
any Restricted Shares, at the request of the holder thereof, at such time as
they become eligible for resale pursuant to Rule 144(k) under the Securities
Act.
10. Definitions As used herein, the following defined terms shall have
-----------
the following meanings:
"Defined Benefit Plan" means a Plan that is or was a "defined benefit
--------------------
plan" as such term is defined in Section 3(35) of ERISA.
"Environmental Laws" means any laws (including, without limitation,
------------------
the Comprehensive Environmental Response, Compensation, and Liability Act),
including any plans, other criteria, or guidelines promulgated pursuant to such
laws, now or hereafter in effect relating to the generation, production,
installation, use, storage, treatment, transportation, release, threatened
release, or disposal of Hazardous Materials, or noise control, or the protection
of human health, safety, natural resources, animal health, or welfare, or the
environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and all Laws promulgated pursuant thereto or in connection therewith.
"ESOP" means an "employee share ownership plan" as such term is
----
defined in Section 407(d)(6) of ERISA or Section 4975(e)(7) of the Code.
"Hazardous Materials" means any wastes, substances, radiation, or
-------------------
materials (whether solids, liquids or gases): (i) that are hazardous, toxic,
infectious, explosive, radioactive, carcinogenic, or mutagenic; (ii) that are
or become defined as "pollutants," "contaminants," "hazardous materials,"
"hazardous wastes," "hazardous substances," "toxic substances," "radioactive
materials," "solid wastes," or other similar designations in, or otherwise
subject to regulation under, any Environmental Laws; (iii) the presence of
which on the real property cause or threaten to cause a nuisance pursuant to
applicable statutory or common law upon the real property or to adjacent
properties; (iv) that contain without limitation polychlorinated biphenyls
(PCBs), asbestos or asbestos-containing materials, lead-based paints, urea-
formaldehyde foam insulation, or petroleum or petroleum products (including,
without limitation, crude oil or any fraction thereof); or (v) that pose a
hazard to human health, safety, natural resources, industrial hygiene, or the
environment, or an impediment to working conditions.
16
<PAGE>
"Individual Account Plan" means a Plan that is or was an "individual
-----------------------
account plan" as such term is defined in Section 3(34) of ERISA.
"Minimum-Funding Plan" means a Pension Plan that is subject to title
--------------------
I, subtitle B, part 3, of ERISA (concerning "funding").
"Other Arrangement" means a benefit program or practice providing for
-----------------
vacation pay, severance pay, insurance, restricted shares, share options,
tuition reimbursement, or any other perquisite or benefit (including, without
limitation, any fringe benefit under Section 132 of the Code) to employees,
officers, or independent contractors that is not a Plan.
"PBGC" means the Pension Benefit Guaranty Corporation or its
----
successor.
"Pension Plan" means an "employee pension benefit plan" as such term
------------
is defined in Section 3(2) of ERISA.
"Plan" means any plan, program, or arrangement, whether or not
----
written, that is or was an "employee benefit plan" as such term is defined in
Section 3(3) of ERISA and (a) that was or is established or maintained by the
Company; (b) to which the Company contributed or was obligated to contribute or
to fund or provide benefits; or (c) that provides or promises benefits to any
person who performs or who has performed services for the Company and because of
those services is or has been (i) a participant therein or (ii) entitled to
benefits thereunder.
"Qualified Plan" means a Pension Plan that satisfies, or is intended
--------------
by the Company to satisfy, the requirements for tax qualification described in
Section 401 of the Code.
"Securities Act" means the Securities Act of 1933, as amended, and all
--------------
laws promulgated pursuant thereto or in connection therewith.
"Title I Plan" means a Plan that is subject to Title I of ERISA.
------------
"Welfare Plan" means an "employee welfare benefit plan" as such term
------------
is defined in Section 3(1) of ERISA.
11. Miscellaneous
-------------
11.1 Successors and Assigns. This Agreement shall be binding upon
----------------------
and inure to the benefit of the parties and their respective successors and
permitted assigns. This Agreement, and the rights and obligations of the
Purchaser hereunder, may be assigned by the Purchaser, in accordance with the
Co-sales Agreement, to any person or entity to which Securities are transferred
by the Purchaser, and such transferee shall be deemed the "Purchaser" for
purposes of this Agreement; provided that the transferee provides written notice
of such assignment to the Company. The Company may not assign its rights under
this Agreement.
11.2 Confidentiality. The Purchaser agrees that it will keep
---------------
confidential and will not disclose, divulge or use for any purpose other than to
monitor its investment in the Company
17
<PAGE>
any confidential, proprietary or secret information which the Purchaser may
obtain from the Company pursuant to financial statements, reports, and other
materials submitted by the Company to the Purchaser pursuant to this Agreement,
or pursuant to visitation or inspection rights granted hereunder ("Confidential
------------
Information"), unless such Confidential Information is known, or until such
-----------
Confidential Information becomes known, to the public (other than as a result of
a breach of this Section 11.2 by the Purchaser); provided, however, that the
-------- -------
Purchaser may disclose Confidential Information (i) to its attorneys,
accountants, consultants, and other professionals to the extent necessary to
obtain their services in connection with monitoring its investment in the
Company, (ii) to any prospective purchaser of any Securities from the Purchaser
as long as such prospective purchaser agrees in writing to be bound by the
provisions of this Section 11.2, (iii) to any affiliate of the Purchaser or to a
partner of the Purchaser, provided that such partner agrees in writing to be
bound by the provisions of this Section 11.2, or (iv) as may otherwise be
required by law, provided that the Purchaser takes reasonable steps to minimize
the extent of any such required disclosure. Notwithstanding any other provisions
of this Section 11.2, the Purchaser shall be free to use the Residuals (as
defined below) of any Confidential Information for any purpose, subject only to
any patents or copyrights of the Company in such Confidential Information. The
term "Residuals" shall mean any information in non-tangible form which is
---------
retained in the memory of the Purchaser or any partner, employee or
Representative of the Purchaser.
11.3 Survival of Representations. All agreements, representation,
---------------------------
and warranties contained herein shall survive the execution and delivery of this
Agreement and the closing of the transactions contemplated hereby for a period
of three years.
11.4 Expenses. The Company and the Purchaser shall each be liable
--------
for their own expenses in conjunction with the transactions contemplated by this
Agreement.
11.5 Brokers. The Company, each Founder, and the Purchaser (i)
-------
represents and warrants to the other parties hereto that he or it has not
retained a finder or broker in connection with the transactions contemplated by
this Agreement, and (ii) will indemnify and save the other parties harmless from
and against any and all claims, liabilities or obligations with respect to
brokerage or finders' fees or commissions, or consulting fees in connection with
the transactions contemplated by this Agreement asserted by any person on the
basis of any statement or representation alleged to have been made by such
indemnifying party.
11.6 Severability. The invalidity or unenforceability of any
------------
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.
11.7 Specific Performance. In addition to any and all other
--------------------
remedies that may be available at law in the event of any breach of this
Agreement, the Purchaser shall be entitled to specific performance of the
agreements and obligations of the Company hereunder and to such other injunctive
or other equitable relief as may be granted by a court of competent
jurisdiction.
11.8 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the internal laws of the State of Florida (without
reference to the conflicts of law provisions thereon).
18
<PAGE>
11.9 Notice. All notices, requests, consents, and other
------
communications under this Agreement shall be in writing and shall be deemed
delivered (i) two business days after, being sent by registered or certified
mail, return receipt requested, postage prepaid or (ii) one business day after
being sent via a reputable nationwide overnight courier service guaranteeing
next business day delivery, in each case to the intended recipient as set forth
below:
If to the Company: Odyssey Marine Exploration, Inc.
3604 Swann Avenue
Tampa, Florida 33609
Attn: John C. Morris
If to the Purchaser: MacDougald Family Limited Partnership
260 First Avenue South, Suite 110
St. Petersburg, Florida 33701
Attn: James E. MacDougald
or at such other address or addresses as may have
been furnished to the Company in writing by the
Purchaser;
With a copy to: Richard A. Denmon, Esq.
Carlton Fields, P.A.
777 South Harbour Island Boulevard
Tampa, Florida 33602
If to the Founders: at the address set forth below the Founders'
signatures to this Agreement.
Any party may give any notice, request, consent or other communication
under this Agreement using any other means (including, without limitation,
personal delivery, messenger service, telecopy, first class mail or electronic
mail), but no such notice, request, consent or other communication shall be
deemed to have been duly given unless and until it is actually received by the
party for whom it is intended. Any party may change the address to which
notices, requests, consents or other communications hereunder are to be
delivered by giving the other parties notice in the manner set forth in this
Section 11.9.
11.10 Complete Agreement. This Agreement (including its Exhibits)
------------------
and the Transaction Documents constitute the entire agreement and understanding
of the parties hereto with respect to the subject matter hereof and supersedes
all prior agreements and understandings relating to such subject matter.
11.11 Amendments and Waivers. Except as otherwise expressly set
----------------------
forth in this Agreement, any term of this Agreement may be amended or terminated
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), with the
written consent of the Company and the holders of at least 90% of the Series B
Preferred Stock or, if no Series B Preferred Stock remains outstanding, of the
shares of Common Stock issued or issuable upon conversion of the Series B
Preferred Stock and upon exercise of the Warrants. Notwithstanding the
foregoing, (i) this Agreement may be
19
<PAGE>
amended with the consent of the holders of less than all of the Series B
Preferred Stock or of the shares of Common Stock issued or issuable upon
conversion of the Series B Preferred Stock and upon exercise of the Warrants
only in a manner which applies to all such holders in the same fashion, and (ii)
no amendment to Section 4 of this Agreement ("Representations of Founders")
---------------------------
shall be effective as to a Founder who has not consented in writing to such
amendment. Any amendment, termination or waiver effected in accordance with this
Section 11 shall be binding upon each holder of any Securities (including shares
of Common Stock into which such Securities have been converted or issued upon
exercise of the Warrants) even if they do not execute such consent, each future
holder of all such securities and the Company. No waivers of or exceptions to
any term, condition or provision of this Agreement, in any one or more
instances, shall be deemed to be, or construed as, a further or continuing
waiver of any such term, condition or provision.
11.12 Pronouns. Whenever the context may require, any pronouns used
--------
in this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural, and
vice versa.
11.13 Counterparts; Facsimile Signatures. This Agreement may be
----------------------------------
executed in any number of counterparts, each of which shall be deemed to be an
original, and all of which shall constitute one and the same document. This
Agreement may be executed by facsimile signatures.
11.14 Section Headings. The section headings are for the convenience
----------------
of the parties and in no way alter, modify, amend, limit, or restrict the
contractual obligations of the parties.
12. Press Release. The Purchaser and the Company will work together to
-------------
issue a mutually agreeable press release regarding this transaction upon the
Closing.
13. Waiver of Jury Trial. The parties hereto waive all right to trial by
--------------------
jury in any action, suit or proceeding brought to enforce or defend any rights
or remedies arising under or in connection with this Agreement or any of the
Transaction Documents, whether grounded in tort, contract or otherwise.
[Remainder of Page Intentionally Blank. Signatures on Next Page.]
20
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf as of the date first written above.
COMPANY:
-------
ODYSSEY MARINE EXPLORATION, INC.,
a Nevada corporation
By: /s/ John C. Morris
-----------------------------------
John C. Morris,
President
PURCHASER:
---------
MACDOUGALD FAMILY LIMITED PARTNERSHIP, a Nevada
limited partnership
By: MACDOUGALD MANAGEMENT, INC., a Nevada
corporation, General Partner
By: /s/ James E. MacDougald
------------------------------
James E. MacDougald,
President
FOUNDERS:
--------
/s/ John C. Morris
---------------------------------------
JOHN C. MORRIS
Address:_______________________________
_______________________________________
/s/ Gregory P. Stemm
---------------------------------------
GREGORY P. STEMM
Address:_______________________________
_______________________________________
21