Document:

Exhibit 4.2

    
      

    

     

    
      Exhibit
        4.2

      

      CERTIFICATE
        OF DESIGNATION

      OF
        PREFERENCES OF

      SERIES
        D PREFERRED STOCK

      OF
        LAPOLLA INDUSTRIES, INC.

      A
        DELAWARE CORPORATION

      PURSUANT
        TO SECTION 151 OF THE

      GENERAL
        CORPORATION LAW OF

      THE
        STATE OF DELAWARE

      

      LaPolla
        Industries Inc. (the "Company") does hereby certify:

      

      Pursuant
        to the authority vested in the Board of Directors of the Company given by
        Article Fourth of the Company's Restated Certificate of Incorporation, as
        amended, the Board of Directors of the Company has duly adopted the following
        resolutions:

      

      NOW,
        THEREFORE, BE IT RESOLVED, that the Board of Directors does hereby provide
        for
        the issuance of a series of preferred stock of the corporation consisting
        of
        25,000 shares designated as "Series D Preferred Stock, par value $1.00 per
        share" and does hereby fix the preferences, qualifications, limitations,
        restrictions and special or relative rights relating to said Series D Preferred
        Stock as follows:

      

      (1)    DESIGNATION;
        VOTING RIGHTS.

      

       (a)    The
        series of preferred stock established hereby shall be designated the "Series
        D
        Preferred Stock, par value $1.00" which series shall herein be referred to
        as
        the "SERIES D PREFERRED STOCK" and the authorized number of Series D Preferred
        Stock shall be 25,000. The stated value per each Series D Preferred Share
        shall
        be $1,000, which includes a par value of $1.00 per share (the "STATED
        VALUE").

      

       (b)    The
        holders of the outstanding Series D Preferred Stock (collectively, the "HOLDERS"
        and each a "HOLDER") shall have no voting rights with respect to the Series
        D
        Preferred Stock, except as required by law, including but not limited to
        The
        General Corporation Law of Delaware, and as expressly provided in this
        Certificate of Designation.

      

      (2)    COMPANY
        REDEMPTION OPTION.

      

       (a)    OPTION
        TO
        REDEEM UPON TRIGGERING EVENT. In addition to all other rights of the Company
        contained herein, after a Triggering Event has occurred (as defined below),
        the
        Company shall have the right in accordance with this Section 2(a), at its
        sole
        option, to (i) redeem all, or any part (pro-rata) of the Series D Preferred
        Stock and (ii) pay to each Holder, to the extent cumulated, if at all, accrued
        but unpaid dividends thereon (the "TRIGGERING EVENT REDEMPTION").

      

       (b)    TRIGGERING
        EVENT. A "TRIGGERING EVENT" shall be deemed to have occurred only upon the
        liquidation or termination of the Company.

      

       (c)    MECHANICS
        OF REDEMPTION UPON TRIGGERING EVENT. If the Company so elects within five
        (5)
        business day after the occurrence of a Triggering Event, the Company shall
        deliver written notice thereof (specifying the Triggering Event) via facsimile
        and overnight courier ("NOTICE OF TRIGGERING EVENT") to each Holder, notifying
        each Holder of its intention to redeem ("NOTICE OF REDEMPTION AT OPTION OF
        COMPANY UPON TRIGGERING EVENT"). Such Notice of Redemption at Option of Company
        Upon Triggering Event shall indicate the number of Series D Preferred Stock
        that
        the Company is redeeming.

      

      (3)    REISSUANCE
        OF CERTIFICATES. In the event of a redemption pursuant to this Certificate
        of
        Designation of less than all of the Series D Preferred Stock, represented
        by a
        particular Preferred Stock Certificate if requested by the Holder, the Company
        shall promptly cause to be issued and delivered to the Holder of such Series
        D
        Preferred Stock a new Series D Preferred Stock Certificate representing the
        remaining Series D Preferred Stock which have not been so redeemed.

      

      (4)    DIVIDENDS.
        The registered Holders of the outstanding Series D Preferred Stock shall
        be
        entitled to receive cumulative dividends at the rate of 7% per annum of the
        Stated Value per each Series D Preferred Share (the "DIVIDEND"). Such Dividend
        shall be payable quarterly in arrears on the last day of March, June, September
        and December of each year, commencing on December 31, 2006 (each of such
        dates
        being a "DIVIDEND PAYMENT DATE"). Such Dividend (a) shall accrue and may
        be
        accumulated or paid in the discretion of the Board of Directors, on each
        Series
        D Preferred Stock from the date of issuance of such Series D Preferred Stock
        (with appropriate pro-ration for any partial dividend period); (b) shall
        accrue
        from day-to-day, whether or not earned or declared; and (c) may be paid,
        subject
        to the terms hereof, in cash when and as declared by the Board of Directors
        of
        the Company out of funds legally available therefor.

      

      (5)    LIQUIDATION,
        DISSOLUTION, WINDING-UP. In the event of any voluntary or involuntary
        liquidation, dissolution or winding up of the affairs of the Company, the
        Holders shall be entitled to receive in cash out of the assets of the Company,
        whether from capital or from earnings available for distribution to its
        stockholders (the "PREFERRED FUNDS"), before any amount shall be paid to
        the
        holders of any of the capital stock of the Company of any class junior in
        rank
        to the Series D Preferred Stock in respect of the preferences as to the
        distributions and payments on the liquidation, dissolution and winding up
        of the
        affairs of the Company, an amount per Series D Preferred Share equal to the
        sum
        of (i) Stated Value and (ii) all accrued and unpaid dividends (such sum being
        referred to as the "LIQUIDATION VALUE"). The purchase or redemption by the
        Company of stock of any class, in any manner permitted by law, shall not,
        for
        the purposes hereof, be regarded as a liquidation, dissolution or winding
        up of
        the affairs of the Company. Neither the consolidation or merger of the Company
        with or into any other Person, nor the sale or transfer by the Company of
        less
        than substantially all of its assets, shall, for the purposes hereof, be
        deemed
        to be a liquidation, dissolution or winding up of the affairs of the
        Company.

      

      (6)    PREFERRED
        RANK. All shares of common stock of the Company shall be of junior rank to
        all
        Series D Preferred Stock in respect to the preferences as to distributions
        and
        payments upon the liquidation, dissolution and winding up of the affairs
        of the
        Company. All other shares of preferred stock issued or issuable shall not
        be of
        senior rank and may not have a status greater than pari passu to all Series
        D
        Preferred Stock outstanding in respect to the preferences as to distributions
        and payments upon the liquidation, dissolution and winding up of the affairs
        of
        the Company. As long as the Series D Preferred Stock initially issued remain
        outstanding, then without the prior express written consent of the Holders
        of
        not less than a majority of the then outstanding Series D Preferred Stock,
        the
        Company shall not hereafter authorize or issue additional or other capital
        stock
        that is of senior rank or that is pari passu with the Series D Preferred
        Stock
        in respect of the preferences as to distributions and payments upon the
        liquidation, dissolution and winding up of the Company. Without the prior
        express written consent of the Holders of not less than a majority of the
        then
        outstanding Series D Preferred Stock, the Company shall not hereafter authorize
        or make any amendment to the Company's Restated Certificate of Incorporation,
        as
        amended, or bylaws, or file any resolution of the Board of Directors of the
        Company with the Delaware Secretary of State containing any provisions, which
        would adversely affect or otherwise impair the rights or relative priority
        of
        the Holders relative to the holders of the Common Stock or the holders of
        any
        other class of capital stock. In the event of the merger or consolidation
        of the
        Company, with or into another Corporation, if the Series D Preferred Stock
        are
        not redeemed in accordance with the terms hereof, such shares shall maintain
        their relative powers, designations and preferences provided for herein and
        no
        such merger shall result in their rights and preferences being inconsistent
        herewith.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (7)    RESTRICTION
        ON REDEMPTION AND CASH DIVIDENDS WITH RESPECT TO OTHER CAPITAL STOCK. Until
        all
        of the outstanding Series D Preferred Stock have been redeemed as provided
        herein, the Company shall not, directly or indirectly, redeem or declare
        or pay
        any cash dividend or distribution on its Common Stock or any other capital
        stock
        without the prior express written consent of the Holders of not less than
        a
        majority of the then outstanding Series D Preferred Stock.

      

      (8)    VOTE
        TO
        CHANGE THE TERMS OF SERIES D PREFERRED STOCK. Any change to this Certificate
        of
        Designation or the Company's Restated Certificate of Incorporation, as amended,
        which would amend, alter, change or repeal any of the rights, preferences,
        qualifications, limitations, restrictions and special or relative rights
        of the
        Series D Preferred Stock shall require the affirmative vote at a meeting
        duly
        called for such purpose of the Holders of not less than a majority of the
        then
        outstanding Series D Preferred Stock.

      

      (9)    LOST
        OR
        STOLEN CERTIFICATES. Upon receipt by the Company of evidence satisfactory
        to the
        Company of the loss, theft, destruction or mutilation of any Preferred Stock
        Certificates representing the Series D Preferred Stock, and, in the case
        of
        loss, theft or destruction, of any indemnification undertaking by the Holder
        to
        the Company and, in the case of mutilation, upon surrender and cancellation
        of
        the Preferred Stock Certificate(s), the Company shall execute and deliver
        new
        Preferred Stock Certificate(s) of like tenor and date; provided, however,
        the
        Company shall not be obligated to re-issue Preferred Stock Certificates if
        the
        Holder contemporaneously requests the Company to convert such Series D Preferred
        Stock into Common Stock.

      

      (10)        
        PREFERRED
        STOCK CAPITALIZATION. The authorized number of shares of Preferred Stock
        of said
        corporation is 2,000,000, of which 750,000 have been authorized for a Series
        A
        Convertible Preferred Stock designation with 62,500 currently issued,
        outstanding and unconverted; 500,000 have been authorized for a Series B
        Convertible Preferred Stock designation with 500,000 issued and converted;
        687,895 have been authorized for an amended Series C Convertible Preferred
        Stock
        designation with 687,895 issued and converted; and 25,000 have been authorized
        for this Series D Preferred Stock, none of which has been issued as of the
        date
        hereof.

      

      This
        corporation further declares by its duly designated executive officer signing
        this certificate under penalty of perjury under the laws of the State of
        Delaware that the matters set forth in this Certificate are true and
        correct.

    

     

    
      	 	
              DATED:
                September 27, 2006

            	 	 	
              LAPOLLA
                INDUSTRIES, INC.

            	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	
              By:

            	
              /s/
                Michael T. Adams, EVP

            	 
	
               

            	 	 	
               

            	
              Michael
                T. Adams

            	 
	 	 	 	 	
              Executive
                Vice President

            	 
	
              Attest:

            	 	 	 	 	 
	 	 	 	 	 	 
	 	
              LAPOLLA
                INDUSTRIES, INC.

            	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	
              By:

            	
              /s/
                Michael T. Adams, Secretary

            	 	 	 	 
	 	
              Corporate
                SecretaryExhibit 10.1

    
      

    

    Exhibit
      10.1

    

    SECURITIES
      PURCHASE AGREEMENT

    

    THIS
      SECURITIES PURCHASE AGREEMENT (the "AGREEMENT"), dated as of September 29,
      2006,
      is by and between LaPolla Industries Inc., a Delaware corporation, with its
      principal place of business at 15402 Vantage Parkway East, Suite 322, Houston,
      Texas 77032 (the "COMPANY"), and Richard J. Kurtz, with a residence at Nine
      Duck
      Pond Road, Alpine, New Jersey 07620 (the "BUYER").

    

    WHEREAS,
      the Company and the Buyer are executing and delivering this Agreement in
      reliance upon the exemption from securities registration afforded by Section
      4(2) of the Securities Act of 1933, as amended (the "ACT");

    

    WHEREAS,
      the Company has authorized the following new series of its preferred stock,
      $1.00 par value per share: the Series D Preferred Stock (the "SERIES D PREFERRED
      STOCK"), with a stated value per share of Series D Preferred Stock of $1,000,
      which includes a $1.00 par value per share (The Series D Preferred Stock is
      referred to in this Agreement as the "SECURITIES"); and

    

    WHEREAS,
      the Buyer wishes to purchase and the Company desires to sell an aggregate of
      6,900 shares of Series D Preferred Stock for a total of $6,900,000, upon the
      terms and conditions stated in this Agreement.

    

    NOW,
      THEREFORE, in consideration of the premises and covenants herein contained,
      the
      Company and the Buyer hereby agree as follows:

    

    1.  PURCHASE
      AND SALE OF SERIES D PREFERRED STOCK.

    

    a.  PURCHASE
      OF SERIES D PREFERRED STOCK. Subject to the satisfaction (or waiver) of the
      conditions set forth in Sections 6 and 7(a) below, the Company shall issue
      and
      sell to the Buyer and the Buyer shall purchase from the Company, for an
      aggregate of $6,900,000 an aggregate of 6,900 shares of Series D Preferred
      Stock
      (the "CLOSING"). On the Closing Date, subject to receipt of the agreed upon
      consideration, the Company shall cause to be delivered to Buyer a stock
      certificate representing the number of shares of Series D Preferred Stock that
      Buyer is then purchasing, duly executed on behalf of the Company and registered
      in the name of the Buyer or his designee (the "STOCK CERTIFICATE").

    

    b.  CLOSING
      DATE. The date and time of the Closing (the "CLOSING DATE") shall be 10:00
      a.m.
      Eastern Daylight Time on September 29, 2006, subject to satisfaction (or waiver)
      of the conditions to the Closing set forth in Sections 6 and 7(a) below (or
      such
      later date as is mutually agreed to by the Company and the Buyer).

    

    c.  FORM
      OF
      PAYMENT. On the Closing Date, Buyer shall cancel indebtedness in the form of
      loans bearing interest owed by Company to Buyer as payment of the applicable
      purchase price for the Series D Preferred Stock to be issued and sold to Buyer
      at the Closing.

    

    2.  BUYER'S
      REPRESENTATIONS AND WARRANTIES. Buyer represents and warrants with respect
      to
      only himself that:

    

    a.  INVESTMENT
      PURPOSE. Such Buyer is acquiring the Series D Preferred Stock for his own
      account for investment only and not with a view towards, or for resale in
      connection with, the unlawful public sale or distribution thereof, except
      pursuant to sales of such shares which are the subject of an effective
      registration statement duly filed under the Act or otherwise exempted under
      the
      Act and all applicable state blue sky laws; provided, however, that by making
      the representations herein, such Buyer does not agree to hold any Securities
      for
      any minimum period or other specific term and reserves the right to dispose
      of
      the Securities at any time in accordance with or pursuant to a registration
      statement or an exemption under the Act and all applicable state blue sky
      laws.

    

    b.  ACCREDITED
      INVESTOR STATUS. Buyer is an "accredited investor" as that term is defined
      in
      Rule 501(a) of Regulation D promulgated by the United States Securities and
      Exchange Commission (the "SEC") under the Act ("REGULATION D").

    

    c.  RELIANCE
      ON EXEMPTIONS. Buyer understands that the Series D Preferred Stock is being
      offered and sold to him in reliance on specific exemptions from the registration
      requirements of United States federal and state securities laws and that the
      Company is relying in part upon the truth and accuracy of, and Buyer's
      compliance with, the representations, warranties, agreements, acknowledgments
      and understandings of Buyer set forth herein in order to determine the
      availability of such exemptions and the eligibility of Buyer to acquire the
      Series D Preferred Stock.

    

    d.  INFORMATION.
      Buyer acknowledges that he is the Chairman of the Board of Directors of the
      Company and as such has been furnished with all materials relating to the
      business, finances and operations of the Company and materials relating to
      the
      offer and sale of the Series D Preferred Stock that have been requested by
      Buyer. No independent due diligence investigations conducted by Buyer shall
      modify, amend or affect Buyer's right to rely on the Company's representations
      and warranties contained in Section 3 below.

    

    e.  NO
      GOVERNMENTAL REVIEW. Buyer understands that no United States federal or state
      agency or any other government or governmental agency has passed on or made
      any
      recommendation or endorsement of the Series D Preferred Stock and the Warrants
      or the fairness or suitability of the investment in the Securities nor have
      such
      authorities passed upon or endorsed the merits of the offering of the Series
      D
      Preferred Stock.

    

    f.  TRANSFER
      OR RESALE. Buyer understands that the: (i) Securities have not been and are
      not
      being registered under the Act or any state securities laws, and may not be
      offered for sale, sold, assigned or transferred unless (A) (i) they have been
      subsequently registered thereunder and (ii) they are offered for sale, sold,
      assigned and transferred in compliance with the prospectus delivery requirements
      of the Act; or (B) Buyer shall have delivered to the Company an opinion of
      counsel, in a generally acceptable form, to the effect that such securities
      to
      be sold, assigned or transferred may be sold, assigned or transferred pursuant
      to an exemption from such registration.

    

    g.  LEGENDS.

    

    (i)  Buyer
      understands that the certificates or other instruments representing the Series
      D
      Preferred Stock shall bear a restrictive legend in substantially the following
      form (and a stop-transfer order may be placed against transfer of such stock
      certificates):

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED OR APPLICABLE STATE SECURITIES LAWS. THE
      SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE,
      SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
      STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
      OR
      APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL, IN A GENERALLY
      ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE
      STATE SECURITIES LAWS.

    

    (ii)  Each
      certificate for Series D Preferred Stock shall also bear the following
      legend:

    

    ANY
      TRANSFEREE OF THIS CERTIFICATE SHOULD CAREFULLY REVIEW THE TERMS OF THE
      COMPANY'S CERTIFICATE OF DESIGNATIONS RELATING TO THE SERIES D PREFERRED SHARES
      REPRESENTED BY THIS CERTIFICATE. THE NUMBER OF SERIES D PREFERRED SHARES
      REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER OF SUCH SHARES
      STATED ON THE FACE HEREOF.

    

    3.  REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY. The Company represents and warrants to Buyer
      as
      set forth in this Section 3.

    

    a.  ORGANIZATION
      AND QUALIFICATION. The Company is duly organized and validly existing in good
      standing under the laws of the jurisdiction in which it is organized, and has
      the requisite corporate power to own its properties and to carry on its business
      as now being conducted. The Company is duly qualified to do business and is
      in
      good standing in every jurisdiction in which the nature of the business
      conducted by it makes such qualification necessary, except to the extent that
      the failure to be so qualified or be in good standing would not have a Material
      Adverse Effect. "MATERIAL ADVERSE EFFECT" means any material adverse effect
      on
      (i) the business, properties, operations, condition (financial or otherwise),
      results of operations or objective prospects of the Company taken as a whole,
      (ii) on the ability of the Company to perform its obligations hereunder, under
      the Certificate of Designation or under the agreements or instruments to be
      entered into or filed in connection herewith or therewith, or (iii) the
      Securities.

    

    b.  AUTHORIZATION;
      ENFORCEMENT; COMPLIANCE WITH OTHER INSTRUMENTS. (i) The Company has the
      requisite corporate power and authority to enter into and perform its
      obligations under this Agreement, to issue, sell and perform its obligations
      with respect to the Series D Preferred Stock in accordance with the terms hereof
      and the Certificate of Designation, (ii) the execution and delivery of this
      Agreement by the Company and the consummation by it of the transactions
      contemplated hereby and thereby, including without limitation the issuance
      of
      the Series D Preferred Stock, have been duly authorized by the Company's Board
      of Directors and no further consent or authorization is required by the Company,
      its Board of Directors or its shareholders, (iii) this Agreement and the
      certificates for the Series D Preferred Stock have been duly executed and
      delivered by the Company, (iv) this Agreement and the certificates for the
      Series D Preferred Stock constitute the valid and binding obligations of the
      Company enforceable against the Company in accordance with their terms, except
      as such enforceability may be limited by general principles of equity or
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      or
      similar laws relating to, or affecting generally, the enforcement of creditors'
      rights and remedies, and (v) the Certificate of Designation will have been
      filed
      with the Secretary of State of the State of Delaware within sixty (60) days
      after the Closing date hereof and will be in full force and effect, enforceable
      against the Company in accordance with its terms.

    

    c.  CAPITALIZATION.
      As of September 29, 2006, the authorized capital stock of the Company consists
      of sixty seven million (67,000,000) shares, of which sixty five million
      (65,000,000) are for common stock and two million (2,000,000) for preferred
      stock. No shares of common stock or preferred stock are subject to preemptive
      rights or any other similar rights or any liens or encumbrances suffered or
      permitted by the Company. There are no securities or instruments containing
      anti-dilution or similar provisions that will be triggered by the issuance
      of
      any of the Securities as described in this Agreement. The Company has furnished
      to the Buyer copies of the Company's Restated Certificate of Incorporation,
      as
      amended, and as in effect on the date hereof (the "RESTATED CERTIFICATE OF
      INCORPORATION"), and the Company's Bylaws, as in effect on the date hereof
      (the
      "BYLAWS"), and the terms of all securities including the material rights of
      the
      holders thereof in respect thereto.

    

    d.  ISSUANCE
      OF SECURITIES. The Securities are duly authorized and, upon issuance in
      accordance with the terms hereof, shall be (i) validly issued, fully paid and
      non-assessable, (ii) free from all taxes, liens and charges with respect to
      the
      issue thereof and (iii) entitled to the rights and preferences set forth in
      the
      Certificate of Designation.

    

    e.  NO
      CONFLICTS. Except as otherwise expressly stated herein, the execution, delivery
      and performance of this Agreement, the performance by the Company of its
      obligations under the Certificate of Designation and the consummation by the
      Company of the transactions contemplated hereby will not (i) result in a
      violation of the Restated Certificate of Incorporation, as amended, any
      Certificate of Designation, Preferences and Rights of any outstanding series
      of
      preferred stock of the Company or Bylaws or (ii) conflict with, or constitute
      a
      default (or an event which with notice or lapse of time or both would become
      a
      default) under, or give to others any rights of termination, amendment,
      acceleration or cancellation of, any material agreement, indenture or instrument
      to which the Company or any of its subsidiaries is a party, or result in a
      violation of any law, rule, regulation, order, judgment or decree (including
      federal and state securities laws and regulations and the rules and regulations
      of the principal market or exchange on which the common stock is traded or
      listed) applicable to the Company or by which any property or asset of the
      Company is bound or affected. The Company is not in violation of any term of
      or
      in default under its Restated Certificate of Incorporation or Bylaws, as
      applicable, any Certificate of Designation, Preferences and Rights of any
      outstanding series of preferred stock of the Company, or any material contract,
      agreement, indebtedness, indenture, instrument, judgment, decree or order
      (collectively referred to as the "MATERIAL CONTRACTS") or any statute, rule
      or
      regulation applicable to the Company. The business of the Company is not being
      conducted, and shall not be conducted, in violation of any material law,
      ordinance or regulation of any governmental entity. Except as specifically
      contemplated by this Agreement and as required under the Act and applicable
      blue
      sky laws, the Company is not required to obtain any consent, authorization
      or
      order of, or make any filing or registration with, any court or governmental
      or
      regulatory or self-regulatory agency in order for it to execute, deliver or
      perform any of its obligations under or contemplated by this Agreement or
      perform its obligations under the Certificate of Designation in accordance
      with
      the terms hereof or thereof.

    

    f.  SEC
      DOCUMENTS; FINANCIAL STATEMENTS. The Company has filed all reports, schedules,
      forms, statements and other documents required to be filed by it with the SEC
      pursuant to the reporting requirements of the Securities Exchange Act of 1934,
      as amended (the "EXCHANGE ACT") (all of the foregoing filed prior to the date
      hereof and all exhibits included therein and financial statements and schedules
      thereto and documents incorporated by reference therein being hereinafter
      referred to as the "SEC DOCUMENTS"). As of their respective dates, the SEC
      Documents complied in all material respects with the requirements of the
      Exchange Act and the rules and regulations of the SEC promulgated thereunder
      applicable to the SEC Documents. As of their respective dates, the financial
      statements of the Company included in the SEC Documents complied as to form
      in
      all material respects with applicable accounting requirements and the published
      rules and regulations of the SEC with respect thereto. Such financial statements
      have been prepared in accordance with generally accepted accounting principles,
      consistently applied during the periods involved (except (i) as may be otherwise
      indicated in such financial statements or the notes thereto, or (ii) in the
      case
      of unaudited interim statements, to the extent they may exclude footnotes or
      may
      be condensed or summary statements) and fairly present in all material respects
      the financial position of the Company as of the dates thereof and the results
      of
      its operations and cash flows for the periods then ended (subject, in the case
      of unaudited statements, to normal year-end audit adjustments).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    g.  ACKNOWLEDGMENT
      REGARDING BUYERS' PURCHASE OF THE SERIES D PREFERRED STOCK. Purchaser's status
      as Chairman of the Board of Directors and holder of more than ten percent (10%)
      of the Company's outstanding shares, the Company acknowledges and agrees that
      for purposes hereof, Buyer is acting in the capacity of an arm's length
      purchaser with respect to this Agreement and the Certificate of Designation
      and
      the transactions contemplated hereby and thereby. The Company further
      acknowledges that for the purposes hereof, Buyer is not acting as a financial
      advisor or fiduciary of the Company (or in any similar capacity) with respect
      to
      this Agreement and the Certificate of Designation and the transactions
      contemplated hereby and thereby and any advice given by Buyer or any of his
      representatives or agents in connection with this Agreement and the Certificate
      of Designation and the transactions contemplated hereby and thereby is merely
      incidental to Buyer's purchase of the Series D Preferred Stock. The Company
      further represents to Buyer that the Company's decision to enter into this
      Agreement has been based solely on the independent evaluation by the Company
      and
      its representatives.

    

    h.  NO
      GENERAL SOLICITATION. Neither the Company, nor any of its affiliates, nor any
      person acting on its or their behalf, has engaged in any form of general
      solicitation or general advertising (within the meaning of Regulation D under
      the Act) in connection with the offer or sale of any of the Securities offered
      hereby.

    

    i.      
      NO
      INTEGRATED OFFERING. Neither the Company, nor any of its affiliates, nor any
      person acting on its or their behalf has, directly or indirectly, made any
      offers or sales of any security or solicited any offers to buy any security,
      under circumstances that would require registration of any of the Securities
      under the Act or cause the offering of any of the Securities to be integrated
      with prior offerings by the Company for purposes of the Act or any applicable
      stockholder approval provisions, including, without limitation, under the rules
      and regulations of any exchange or automated quotation system on which any
      of
      the securities of the Company are listed or designated, nor will the Company
      take any action or steps that would require registration of the issuance by
      the
      Company of any of the Securities under the Act or cause the offering of the
      Securities to be integrated with other offerings.

    

    j.      
      INTELLECTUAL
      PROPERTY RIGHTS. The Company owns or possesses adequate rights or licenses
      to
      use all trademarks, trade names, service marks, service mark registrations,
      service names, patents, patent rights, copyrights, inventions, licenses,
      approvals, governmental authorizations, trade secrets and rights (collectively
      "INTELLECTUAL PROPERTY RIGHTS") necessary to conduct their respective businesses
      as now conducted and as presently contemplated to be operated in the future
      except for Intellectual Property Rights that, individually or in the aggregate,
      would not be reasonably likely to have a Material Adverse Effect.

    

    k.  LEASES.
      Any real property and facilities held under lease by the Company are held under
      valid, subsisting and enforceable leases.

    

    l.      
      INSURANCE.
      The Company is insured by insurers of recognized financial responsibility
      against such losses and risks and in such amounts as is prudent and customary
      in
      the businesses in which the Company is engaged. The Company does not have any
      reason to believe that it will not be able to renew its existing insurance
      coverage as and when such coverage expires or to obtain similar coverage from
      similar insurers as may be necessary to continue its business at a cost that
      would not individually or in the aggregate have a Material Adverse
      Effect.

     

    m.     INTERNAL
      ACCOUNTING CONTROLS. The Company maintains a system of internal accounting
      controls sufficient to provide reasonable assurance that (i) transactions are
      executed in accordance with management's general or specific authorizations,
      (ii) transactions are recorded as necessary to permit preparation of financial
      statements in conformity with generally accepted accounting principles and
      to
      maintain asset accountability, (iii) access to assets is permitted only in
      accordance with management's general or specific authorization and (iv) the
      recorded accountability for assets is compared with the existing assets at
      reasonable intervals and appropriate action is taken with respect to any
      differences.

    

    n.  TAX
      STATUS. The Company has made all federal and state income and all other tax
      returns, reports and declarations required by any jurisdiction to which it
      is
      subject (unless and only to the extent that the Company has set aside on its
      books provisions reasonably adequate for the payment of all unpaid and
      unreported taxes) and has paid all taxes and other governmental assessments
      and
      charges that are material in amount, shown or determined to be due on such
      returns, reports and declarations. There are no unpaid taxes in any material
      amount claimed to be due by the taxing authority of any jurisdiction, and the
      officers of the Company know of no basis for any such claim. The Company has
      not
      been notified that any of its tax returns is currently being audited by any
      taxing authority.

    

    4.  COVENANTS
      AND AGREEMENTS.

    

    a.  BEST
      EFFORTS. Each party shall use its best efforts timely to satisfy each of the
      conditions to be satisfied by it as provided in Sections 6 and 7 of this
      Agreement.

    

    b.  BLUE
      SKY.
      The Company shall take such action as the Company shall reasonably determine
      is
      necessary in order to obtain an exemption for or to qualify the Securities
      for,
      or obtain exemption for the Securities for, sale to Buyer pursuant to this
      Agreement under applicable securities or "Blue Sky" laws of the State of New
      Jersey. The Company shall make all filings and reports relating to the offer
      and
      sale of the Securities required under applicable securities or "Blue Sky" laws
      of the State of New Jersey wherein the Buyer resides.

    

    c.  FINANCIAL
      INFORMATION. The Company agrees to file all reports, schedules, forms,
      statements and other documents required to be filed by it with the SEC pursuant
      to the reporting requirements of the Exchange Act so long as the Series D
      Preferred Stock shall be outstanding. The financial statements of the Company
      will be prepared in accordance with generally accepted accounting principles,
      consistently applied, and will fairly present in all material respects the
      consolidated financial position of the Company and results of its operations
      and
      cash flows for the periods then ended (subject, in the case of unaudited
      statements, to normal year-end audit adjustments).

    

    d.  CORPORATE
      EXISTENCE. So long as any Buyer beneficially owns any Securities pursuant to
      this Agreement, the Company shall maintain its corporate existence in good
      standing under the laws of the jurisdiction in which it is incorporated and
      shall not sell all or substantially all of the Company's assets, except in
      the
      event of a merger or consolidation or sale of all or substantially all of the
      Company's assets for cash, or, if for securities, where the surviving or
      successor entity in such transaction either (i) redeems all of the then
      outstanding Series D Preferred Stock in accordance with and subject to the
      terms
      of the Certificate of Designation applicable to such transactions, or (ii)
      assumes the Company's obligations hereunder and under the agreements and
      instruments entered into in connection herewith.

    

    e.  INSURANCE.
      The Company shall maintain liability, casualty and other insurance (subject
      to
      customary deductions and retentions) with responsible insurance companies
      against such risk of the types and in the amounts customarily maintained by
      companies of comparable size to the Company.

    

    6.  CONDITIONS
      TO THE COMPANY'S OBLIGATION TO SELL. The obligation of the Company hereunder
      to
      issue and sell the Series D Preferred Stock to Buyer at the Closing is subject
      to the satisfaction of each of the following conditions, provided that these
      conditions are for the Company's sole benefit and may be waived by the Company
      at any time in its sole discretion:

    

    a.  Buyer
      shall have executed this Agreement and delivered the same to the
      Company.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    b.  Buyer
      shall have delivered to the Company the applicable purchase price for the Series
      D Preferred Stock being purchased by Buyer at Closing.

    

    c.  The
      representations and warranties of Buyer shall be true and correct in all
      material respects as of the Closing Date as though made at that time (except
      for
      representations and warranties that speak as of a specific date), and Buyer
      shall have performed, satisfied and complied in all material respects with
      the
      covenants, agreements and conditions required by this Agreement to be performed,
      satisfied, or complied with by Buyer at or prior to the Closing
      Date.

    

    7.  CONDITIONS
      TO EACH BUYER'S OBLIGATION TO PURCHASE.

    

    a.  CLOSING
      DATE. The obligation of Buyer hereunder to purchase the Series D Preferred
      Stock
      at the Closing is subject to the satisfaction, at or before the Closing Date,
      of
      each of the following conditions, provided that these conditions are for Buyer's
      sole benefit and may be waived by such Buyer at any time in his sole
      discretion:

    

    i.        The
      Company shall have executed this Agreement and delivered the same to such
      Buyer.

    

    ii.       The
      Certificate of Designation shall have been executed by the Company and filed
      with the Secretary of the State of Delaware, and a copy marked as filed shall
      have been delivered to such Buyer.

    

    iii.  The
      representations and warranties of the Company shall be true and correct in
      all
      material respects (except to the extent that any of such representations and
      warranties is already qualified as to materiality in Section 3 above, in which
      case such representations and warranties shall be true and correct without
      further qualification) as of the Closing Date as though made at that time
      (except for representations and warranties that speak as of a specific date)
      and
      the Company shall have performed, satisfied and complied in all material
      respects with the covenants, agreements and conditions required by this
      Agreement to be performed, satisfied or complied with by the Company at or
      prior
      to the Closing Date. Buyer shall have received a certificate, executed by an
      authorized officer of the Company, dated as of the Closing Date, to the
      foregoing effect and as to such other matters as may be reasonably requested
      by
      Buyer.

    

    iv.  The
      Company shall have executed and delivered to Buyer the Stock Certificates (in
      such denominations as such Buyer shall request) for the Series D Preferred
      Stock
      being purchased by Buyer being given at the Closing.

    

    v.      
      The
      Company shall have delivered to Buyer such other documents relating to the
      transactions contemplated by this Agreement as Buyer may reasonably
      request.

    

    vi.  The
      transactions contemplated hereby shall not violate any law, regulation or order
      then in effect and applicable to Buyer or the Company.

    

    8. INDEMNIFICATION.
      In consideration of each Buyer's execution and delivery of this Agreement and
      acquiring the Securities hereunder and in addition to all of the Company's
      other
      obligations under this Agreement, the Company shall defend, protect, indemnify
      and hold harmless Buyer and each other holder of Securities from and against
      any
      and all actions, causes of action, suits, claims, losses, costs, penalties,
      fees, liabilities and damages, and expenses in connection therewith
      (irrespective of whether Buyer is a party to the action for which
      indemnification hereunder is sought), and including reasonable attorneys' fees
      and disbursements (the "BUYER INDEMNIFIED LIABILITIES"), incurred by Buyer
      (and
      shall advance the same) as a result of, or arising out of, or relating to (a)
      any misrepresentation or breach of any representation or warranty made by the
      Company in this Agreement, the Certificate of Designation or any other
      certificate, instrument or document contemplated hereby or thereby, (b) any
      breach of any covenant, agreement or obligation of the Company contained in
      this
      Agreement, the Certificate of Designation or any other certificate, instrument
      or document contemplated hereby or thereby, or (c) any cause of action, suit
      or
      claim brought or made against Buyer and arising out of or resulting from the
      execution, delivery, performance or enforcement of this Agreement or any other
      instrument, document or agreement executed pursuant hereto by the Buyer.
      Promptly after receipt by Buyer of notice of the commencement of any action
      or
      proceeding (including any governmental action or proceeding) involving the
      Buyer
      Indemnified Liabilities, Buyer shall deliver to the Company a written notice
      of
      the commencement thereof, and the Company shall have the right to participate
      in, and, to the extent it so desires, jointly with any other indemnifying party
      similarly noticed, to assume control of the defense thereof with counsel
      selected by the Company and reasonably satisfactory to Buyer; provided, however,
      that Buyer shall have the right to retain its own counsel with the fees and
      expenses to be paid by the Company, if, in the reasonable opinion of counsel
      retained by the Company, the representation by such counsel of the Buyer and
      the
      Company would be inappropriate due to actual differing interests between Buyer
      and any other party represented by such counsel in such proceeding. The Buyer
      shall cooperate fully with the Company in connection with any negotiation or
      defense of any such action or claim by the Company and shall furnish to the
      Company all information reasonably available to the Buyer which relates to
      such
      action or claim. The Company shall keep the Buyer fully apprised at all times
      as
      to the status of the defense or any settlement negotiations with respect
      thereto. The Company shall not be liable for any settlement of any action,
      claim
      or proceeding affected without its written consent, provided, however, that
      the
      Company shall not unreasonably withhold, delay or condition its consent. The
      Company shall not, without the consent of the Buyer, consent to entry of any
      judgment or enter into any settlement or other compromise which does not include
      as an unconditional term thereof the giving by the claimant or plaintiff to
      such
      Buyer of a release from all liability in respect to such claim or litigation.
      Following indemnification as provided for hereunder, the Company shall be
      subrogated to all rights of the Buyer with respect to all third parties, firms
      or corporations relating to the matter for which indemnification has been made.
      The failure to deliver written notice to the Company within a reasonable time
      of
      the commencement of any such action shall not relieve it of any liability to
      the
      Buyer, except to the extent that the Company is prejudiced in its ability to
      defend such action. To the extent that the foregoing undertaking by the Company
      may be unenforceable for any reason, the Company shall make the maximum
      contribution to the payment and satisfaction of each of the Buyer Indemnified
      Liabilities which is permissible under applicable law.

    

    9.  MISCELLANEOUS.

    

    a.  COUNTERPARTS.
      This Agreement may be executed in two or more identical counterparts, all of
      which shall be considered one and the same agreement and shall become effective
      when counterparts have been signed by each party and delivered to the other
      party, PROVIDED THAT a facsimile signature shall be considered due execution
      and
      shall be binding upon the signatory thereto with the same force and effect
      as if
      the signature were an original, not a facsimile signature.

    

    b.  HEADINGS.
      The headings of this Agreement are for convenience of reference and shall not
      form part of, or affect the interpretation of, this Agreement.

    

    c.  SEVERABILITY.
      If any provision of this Agreement shall be invalid or unenforceable in any
      jurisdiction, such invalidity or unenforceability shall not affect the validity
      or enforceability of the remainder of this Agreement in that jurisdiction or
      the
      validity or enforceability of any provision of this Agreement in any other
      jurisdiction.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    d.  ENTIRE
      AGREEMENT; AMENDMENTS. This Agreement and the documents referred to herein,
      supersede all other prior or contemporaneous oral or written agreements between
      or among the Buyer, the Company, their affiliates and persons acting on their
      behalf with respect to the matters discussed herein, and this Agreement and
      the
      instruments referenced herein contain the entire understanding of the parties
      with respect to the matters covered herein and therein and, except as
      specifically set forth herein or therein, neither the Company nor Buyer makes
      any representation, warranty, covenant or undertaking with respect to such
      matters. No provision of this Agreement may be waived or amended other than
      by
      an instrument in writing signed by the Company and the holders of at least
      2/3
      of the then outstanding Series D Preferred Stock, but any such waiver or
      amendment shall bind all Buyers and holders.

    

    e.  NOTICES.
      Any notices, consents, waivers or other communications required or permitted
      to
      be given under the terms of this Agreement must be in writing and will be deemed
      to have been delivered (i) upon receipt, when delivered personally; (ii) upon
      receipt, when sent by facsimile, provided a copy is mailed by U.S. certified
      mail, return receipt requested; (iii) three (3) business days after being sent
      by U.S. certified mail, return receipt requested, or (iv) one (1) business
      day
      after deposit with a nationally recognized overnight delivery service, in each
      case properly addressed to the party to receive the same. The addresses and
      facsimile numbers for such communications shall be:

    

    
      	 	
              if
                to the Company:

            	
              LaPolla
                Industries, Inc.

            

    

    
      	 	
              15402
                Vantage Parkway East

            

    

    
      	 	
              Suite
                322

            

    

    
      	 	
              Houston,
                Texas 77032

            

    

    
      	 	
              Telephone:
                (281) 219-4700

            

    

    
      	 	
              Attention:
                Michael T. Adams, Corporate
                Secretary

            

    

    

    
      	 	
              with
                a copy to:

            

    

    

    
      	 	
              Sierchio
                Greco & Greco, LLP

            

    

    
      	 	
              720
                Fifth Avenue

            

    

    
      	 	
              Suite
                1301

            

    

    
      	 	
              New
                York, New York 10019

            

    

    
      	 	
              Telephone:
                (212) 246-3030

            

    

    
      	 	
              Attention:
                Alfred V. Greco, Esquire

            

    

    

    
      	 	
              if
                to the Buyer:

            

    

    

    
      	 	
              Richard
                J. Kurtz

            

    

    
      	 	
              Nine
                Duck Pond Road

            

    

    
      	 	
              Alpine,
                New Jersey 07620

            

    

    
      	 	
              Telephone:
                (212) 768-3154

            

    

    

    f.  SUCCESSORS
      AND ASSIGNS. This Agreement shall be binding upon and inure to the benefit
      of
      the parties and their respective successors and assigns, including any
      purchasers of the Securities. The Company shall not assign this Agreement or
      any
      rights or obligations hereunder without the prior written consent of the holders
      of two thirds (2/3) of the Series D Preferred Stock then outstanding. A Buyer
      may assign some or all of its rights hereunder without the consent of the
      Company, PROVIDED, HOWEVER, that (i) any such assignment shall not release
      such
      Buyer from its obligations hereunder unless such obligations are assumed by
      such
      assignee and the Company has consented to such assignment and assumption, which
      consent shall not be unreasonably withheld; (ii) Buyer may not assign his
      purchase or other rights hereunder in a manner that would cause the offering
      of
      Securities hereunder to be required to be registered under the Act; (iii) Buyer
      may not assign his purchase or other rights with respect to the Series D
      Preferred Stock; and (iv) Buyer may not assign his rights hereunder to an entity
      that in the good faith judgment of the Board of Directors of the Company is
      competitive with a core business of the Company.

    

    g.  NO
      THIRD
      PARTY BENEFICIARIES. This Agreement is intended for the benefit of the parties
      hereto and their respective permitted successors and assigns, and is not for
      the
      benefit of, nor may any provision hereof be enforced by, any other
      person.

    

    h.  SURVIVAL.
      The representations and warranties of the Company and the Buyer contained in
      Sections 3 and 2, respectively, shall survive the Closing until three years
      after the Closing Date, including, without limitation, all financial statements
      thereto. The agreements and covenants set forth in Sections 4, 5 and 9, and
      the
      indemnification provisions set forth in Section 8, shall survive the Closing.
      Buyer shall be responsible only for his own representations, warranties,
      agreements and covenants hereunder.

    

    i.      
      FURTHER
      ASSURANCES. Each party shall do and perform, or cause to be done and performed,
      all such further acts and things, and shall execute and deliver all such other
      agreements, certificates, instruments and documents, as the other party may
      reasonably request in order to carry out the intent and accomplish the purposes
      of this Agreement and the consummation of the transactions contemplated
      hereby.

    

    j.      
      NO
      STRICT
      CONSTRUCTION. The language used in this Agreement will be deemed to be the
      language chosen by the parties to express their mutual intent, and no rules
      of
      strict construction will be applied against any party.

    

    k.  GOVERNING
      LAW; JURISDICTION; JURY TRIAL. All questions concerning the construction,
      validity, enforcement and interpretation of this Agreement shall be governed
      by
      the internal laws of the State of New York, without giving effect to any choice
      of law or conflict of law provision or rule that would cause the application
      of
      the laws of any jurisdiction other than the State of New York. Each party hereby
      irrevocably submits to the non-exclusive jurisdiction of the state and federal
      courts sitting in The City of New York, borough of Manhattan, for the
      adjudication of any dispute hereunder or in connection herewith or with any
      transaction contemplated hereby or discussed herein, and hereby irrevocably
      waives, and agrees not to assert in any suit, action or proceeding, any claim
      that it is not personally subject to the jurisdiction of any such court, that
      such suit, action or proceeding is brought in an inconvenient forum or that
      the
      venue of such suit, action or proceeding is improper. Each party hereby
      irrevocably waives personal service of process and consents to process being
      served in any such suit, action or proceeding by mailing a copy thereof to
      such
      party at the address for such notices to it under this Agreement and agrees
      that
      such service shall constitute good and sufficient service of process and notice
      thereof. Nothing contained herein shall be deemed to limit in any way any right
      to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
      WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
      ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING
      OUT
      OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    l.      
      REMEDIES.
      Buyer and each holder of the Securities shall have all rights and remedies
      set
      forth in this Agreement and the Certificate of Designation and all rights and
      remedies which such holders have been granted at any time under any other
      agreement or contract and all of the rights which such holders have under any
      law. Any person having any rights under any provision of this Agreement shall
      be
      entitled to enforce such rights specifically (without posting a bond or other
      security), to recover damages by reason of any breach of any provision of this
      Agreement and to exercise all other rights granted by law.

    

    IN
      WITNESS WHEREOF, the Buyer and the Company have caused this Securities Purchase
      Agreement to be duly executed as of the date first written above.

    

    
      	
              LAPOLLA
                INDUSTRIES, INC.

            	 	 	
              RICHARD
                J. KURTZ

            	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
              By:

            	
              /s/
                Michael T. Adams, EVP

            	 	 	
              By:

            	
              /s/
                Richard J. Kurtz

            	 
	
              Name:

            	
              Michael
                T. Adams

            	 	 	 	
              Name:
                Richard J. Kurtz

            	 
	
              Title:

            	
              Executive
                Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00112-of-00352.parquet"}]]