Attached files
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| EX-10.1 - Kun Run Biotechnology, Inc. | v181907_ex10-1.htm |
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): April 22, 2010 (April 17,
2010)
Kun Run Biotechnology,
Inc.
(Exact
name of registrant as specified in Charter)
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Nevada
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333-141384
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98-0517550
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(State
or other jurisdiction of
incorporation
or organization)
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(Commission
File No.)
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(IRS
Employee Identification
No.)
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Free
Trade Zone
168
Nanhai Avenue, Haikou City
Hainan
Province, China 570216
(Address
of Principal Executive Offices)
86-898-6680-2207
(Issuer
Telephone number)
Aspen Racing Stables,
Inc.
(Former
name and former address, if applicable)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01 Entry into a Material Definitive Agreement.
On April 17, 2010 (the “Signing Date”),
Kun Run Biotechnology, Inc. (the “Company”) entered into a Securities Purchase
Agreement (“Securities Purchase Agreement”) by and among the Company, Caduceus
Asia Partners, L.P., an investment fund managed by OrbiMed (the “Purchaser”),
and Mr. Xueyun Cui, the Chairman of the Company’s Board of Directors and the
majority stockholder of the Company (the “Key Stockholder”), under the terms of
which the Purchaser agreed to purchase and the Company agreed to issue of up to
$8,000,000 of units of the Company (each a “Unit” and together, the “Units”),
with each Unit consisting of (A) one share of the Series A Preferred Stock of
the Company, par value $0.001 per share (the “Series A Preferred”) and (B) one
warrant (each, a “Net Income Warrant,” and collectively, the “Net
Income Warrants”) to purchase 0.30 of a share of Series A
Preferred. The Net Income Warrants are exercisable only if the
Company fails to achieve thresholds of net income before certain expenses in its
audited income statement for the 2010 fiscal year. If the Net Income
Warrants become exercisable, they have a cashless exercise feature.
In connection with the transactions
contemplated by the Securities Purchase Agreement, the Company will designate
6,800,000 shares of Series A Preferred Stock. The holders of the
Series A Preferred shall have the right to convert the Series A Preferred at any
time into Common Stock at an initial conversion ratio of one-to-one, subject to
adjustments, including anti-dilution adjustments and proportional adjustments
for stock splits, stock dividends and recapitalizations. The holders
of the Series A Preferred shall also be entitled to receive dividends in
preference to dividends distributed to holders of the Common Stock and to
participate pro rata in any dividends paid on the Common Stock on an as
converted basis. In addition, the holders of the Series A Preferred
will be entitled to nominate one member of the Company’s board of directors and
the Company will be obligated to have such nominee elected on and after the
closing of the transactions contemplated by the Securities Purchase Agreement so
long as the Purchaser beneficially owns at least five percent of the Common
Stock of the Company on an as-converted basis. In connection with the
transactions contemplated by the Securities Purchase Agreement, the Company’s
board of directors will also be obligated to include an independent
director not affiliated with the Company or the Purchaser.
The holders of the Series A Preferred
will vote together with the Common Stock and not as a separate
class. However, consent of the holders of a majority of the Series A
Preferred shall be required for certain actions, including increases or
decreases the authorized amount of the Common Stock or any class or series of
Preferred Stock amendments to certain rights of the Series A Preferred holders,
acquisitions or asset transfers, payments or declarations of any dividends or
distributions to any shares of Common Stock or any class or series of preferred
stock, and issuances of debt in excess of $250,000 unless such issuance of debt
has been approved by a majority of the Corporation’s Board of
Directors.
In addition, the holders of the Series
A Preferred shall be entitled to receive a liquidation preference payment in
preference to the holders of the Common Stock in the event of any liquidation or
winding up of the Company.
The Units are to be issued in a private
transaction pursuant to the “safe harbor” for the private offering
exemption under Section 4(2) of the Securities Act of 1933 (the “Securities
Act”) and Rule 506 of Regulation D promulgated thereunder to accredited
investors as defined under Rule 501(a) of the Securities Act.
The Company intends to use the proceeds
from the Units for the following purposes: (i) potential acquisitions of drug
products and pipeline assets, (ii) working capital, (iii) payment of fees of
consultants of the Company, (iv) reimbursement of fees of the Purchaser in the
contemplated transaction, and (v) repayment of certain outstanding obligations
of the Company or its subsidiaries.
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A copy of the Securities Purchase
Agreement is filed as Exhibit 10.1 to this Form 8-K.
Item
3.02 Unregistered Sales of Equity Securities.
See Item
1.01 above, which is incorporated herein by reference.
Item 9.01 Financial Statements and
Exhibits.
(d)
Exhibits
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10.1
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Securities
Purchase Agreement dated April 17, 2010 by and among the Company,
Purchaser and the Key
Stockholder
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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KUN RUN BIOTECHNOLOGY,
INC.
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(Registrant)
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Dated:
April 22, 2010
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By:
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/s/ Xiaoqun Ye
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Name:
Xiaoqun Ye
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Title:
Chief Executive
Officer
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