AGREEMENT
AGREEMENT
THIS AGREEMENT (this “Agreement”), dated as of October 10, 2016, is entered into by and among Quantum Materials Corp., a Nevada corporation (the “Company”), Xxxxxx Haysco Holdings, LP, a Texas limited partnership (“Xxxxxx Haysco”) and Xxxxxx Diversified Investments, LP, a Texas limited partnership (“Xxxxxx Diversified” and together with Xxxxxx Haysco, the “Holders”).
WHEREAS, pursuant to (i) that certain Convertible Debenture, dated January 15, 2015, the Company agreed to pay Xxxxxx Haysco the principal amount of $250,000 on or before January 15, 2017 (the “Maturity Date”) and (ii) that certain Convertible Debenture, dated January 15, 2015, the Company agreed to pay Xxxxxx Diversified the principal amount of $250,000 on or before the Maturity Date (collectively, the “2015 Convertible Debentures”);
WHEREAS, pursuant to (i) that certain Common Stock Purchase Warrant, dated January 31, 2014, the Company granted Xxxxxx Haysco the right and option to purchase up to 2,500,000 shares of common stock of the Company (“Shares”) at an exercise price of $0.06 (the “2014 Xxxxxx Haysco Warrant”) and (ii) that certain Company Stock Purchase Warrant, dated January 31, 2014, the Company granted Xxxxxx Diversified the right and option to purchase up to 2,500,000 Shares at an exercise price of $0.06 (the “2014 Xxxxxx Diversified Warrant” and together with the 2014 Xxxxxx Haysco Warrant, the “2014 Warrants”);
WHEREAS, pursuant to (i) that certain Common Stock Purchase Warrant, dated January 31, 2015, the Company granted Xxxxxx Haysco the right and option to purchase up to 3,125,000 Shares at an exercise price of $0.06 (the “2015 Xxxxxx Haysco Warrant”) and (ii) that certain Company Stock Purchase Warrant, dated January 31, 2015, the Company granted Xxxxxx Diversified the right and option to purchase up 3,125,000 Shares at an exercise price of $0.06 (the ” 2015 Xxxxxx Diversified Warrant”, and together with the 2015 Xxxxxx Haysco Warrant, the “2015 Warrants”); and
WHEREAS, the Company and Holders have agreed to enter into this Agreement (i) to amend the 2015 Convertible Debentures to extend the Maturity Date, (ii) to amend the 2014 Warrants to permit the cashless exercise of 1,250,000 Shares to Xxxxxx Haysco and 1,250,000 Shares to Xxxxxx Diversified and to terminate the 2014 Warrants upon the Cashless Exercise (defined below) and (iii) to exercise the 2015 Warrants for the 2015 Warrant Purchase Price (defined below) in exchange for the Company’s issuance of 3,125,000 Shares to Xxxxxx Haysco and 3,125,000 Shares to Xxxxxx Diversified.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Holders hereby agree as follows:
1. Amendment to 2015 Convertible Debentures. The Maturity Date of the 2015 Convertible Debentures is extended to January 15, 2018 with all other terms and provisions thereof remaining in full force and effect.
2. Amendment to 2014 Warrants; Termination of Remaining 2014 Warrants. The Company hereby agrees to the following: (i) the issuance of 1,250,000 Shares (one-half) of the 2,500,000 Shares pursuant to the 2014 Xxxxxx Haysco Warrant in exchange for the cancellation of the remaining unexercised portion of the 2014 Xxxxxx Haysco Warrants with such 1,250,000 Shares to be issued upon receipt of the warrant exercise form attached hereto as Exhibit A and (ii) the issuance of 1,250,000 Shares (one-half) of the 2,500,000 Shares pursuant to the 2014 Xxxxxx Diversified Warrant in exchange for the cancellation of the remaining unexercised portion of the 2014 Xxxxxx Diversified Warrant with such 1,250,000 Shares to be issued upon receipt of the warrant exercise form attached hereto as Exhibit B (collectively, the “Cashless Exercise”). In exchange for and upon the Cashless Exercise, each of the Company, Xxxxxx Haysco and Xxxxxx Diversified agrees to the following: (i) the right and option to purchase the remaining 1,250,000 Shares pursuant to the 2014 Xxxxxx Haysco Warrant and the right and option to purchase the remaining 1,250,000 Shares pursuant to the 2014 Xxxxxx Diversified Warrant shall terminate and not be issued to any other holder, (ii) Xxxxxx Haysco and Xxxxxx Diversified shall have no further rights under the respective 2014 Warrants, and (iii) the Cashless Exercise is the full and complete exercise of the 2014 Warrants.
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3. Exercise of 2015 Warrants. Each of Xxxxxx Haysco and Xxxxxx Diversified hereby elects exercise the respective 2015 Xxxxxx Haysco Warrant for $187,500 and the 2015 Xxxxxx Diversified Warrant for $187,500 for the aggregate purchase price of $375,000 (the “2015 Warrant Purchase Price”), and the Company hereby agrees to issue 3,125,000 Shares to Xxxxxx Haysco and 3,125,000 Shares to Xxxxxx Diversified upon receipt of (i) the 2015 Warrant Purchase Price and (ii) the subscription forms attached to the respective 2015 Warrants.
4. Representations and Warranties. The Company hereby makes to the Holders the following representations and warranties:
(a) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, its board of directors or its stockholders in connection therewith. This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies, and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.
(b) No Conflicts. The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby do not and will not: (i) conflict with or violate any provision of the Company’s or any subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any lien upon any of the properties or assets of the Company or any subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any material agreement, credit facility, debt or other material instrument (evidencing a Company or subsidiary debt or otherwise) or other material understanding to which the Company or any subsidiary is a party or by which any property or asset of the Company or any subsidiary is bound or affected, or (iii) conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a material adverse effect.
(c) Duly Authorized. Upon the exercise of the 2014 Xxxxxx Haysco Warrant and the 2014 Xxxxxx Diversified Warrant pursuant to Section 2 in exchange for the cancellation of the remaining unexercised portion of such warrants and upon the exercise of the 2015 Xxxxxx Haysco Warrant and the 2015 Xxxxxx Diversified Warrant pursuant to Section 3 in exchange for delivery of the 2015 Warrant Purchase Price, the 4,375,000 shares of the Company’s Shares issued to each of Xxxxxx Haysco and Xxxxxx Diversified (or 8,750,000 shares in the aggregate) will all be duly authorized, validly issued, fully paid and non-assessable and free and clear of any liens.
5. Miscellaneous.
(a) Except as expressly set forth above, all of the terms and conditions of the 2015 Convertible Debentures and the Warrants shall continue in full force and effect including, but not limited to, the option to fund the remaining $150,000 of the Phase 2 Convertible Debentures and to obtain the remaining Phase 2 Warrants as each is defined in that certain Amended and Restated Subscription Agreement dated January 15, 2015, by and among the Company, Xxxxxx Haysco and Xxxxxx Diversified. The Company shall, within three (3) trading days of the date hereof, issue a Current Report on Form 8-K disclosing the material terms of the transactions contemplated hereby (the “8-K Filing”). From and after the filing of the 8-K Filing with the Securities and Exchange Commission, the Holders shall not be in possession of any material, nonpublic information received from the Company, any of its subsidiaries or any of their respective officers, directors, employees or agents that is not disclosed in the 8-K Filing. The Company shall consult with the Holders in issuing any other press releases with respect to the transactions contemplated hereby.
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(b) This Agreement may be executed in two or more counterparts and by facsimile signature or otherwise, and each of such counterparts shall be deemed an original and all of such counterparts together shall constitute one and the same agreement.
(c) If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
(d) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Texas (without giving effect to any conflicts or choice of law provisions thereof).
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, this Agreement is executed as of the date first set forth above.
| QUANTUM MATERIALS CORP. | ||
| By: | ||
| Name: | Xxxxx Xxxxxxxx | |
| Title: | Chief Financial Officer | |
| XXXXXX HAYSCO HOLDINGS, LP | ||
| By: Xxxxxx Diversified GP, LLC | ||
| Its General Partner | ||
| By: | ||
| Name: | X.X. Xxxxxx | |
| Title: | Manager of the General Partner | |
| XXXXXX DIVERSIFIED INVESTMENTS, LP | ||
| By: Xxxxxx Diversified GP, LLC | ||
| Its General Partner | ||
| By: | ||
| Name: | X.X. Xxxxxx | |
| Title: | Manager of the General Partner | |
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Exhibit A
Notice of Exercise
| To: | Quantum Materials Corp. |
| 0000 Xxxxxx Xxxx | |
| Xxx Xxxxxx, Xxxxx 00000 | |
| Attn: Sri Peruvemba, Chief Executive Officer |
The undersigned Holder hereby elects to purchase 1,250,000 Shares of Quantum Materials Corp. (the “Company”) pursuant to the terms of that certain Common Stock Purchase Warrant, dated January 31, 2014 (the “Warrant”) and the terms of the Agreement, dated October ___, 2016, by and among the Company, Xxxxxx Haysco Holdings, LP and Xxxxxx Diversified Investments, LP (the “Agreement”). The payment of the Exercise Price (as set forth in the Warrant) shall be the cancellation of the remaining warrants to acquire Shares of the Company under the Warrant.
Please issue a certificate or certificates representing said Shares in the name of the undersigned or in such other name as is specified below:
_________________________________________
(Name)
_________________________________________
_________________________________________
(Address)
| XXXXXX HAYSCO HOLDINGS, LP | ||
| By: | ||
| Its General Partner | ||
| By: | ||
| Name: | ||
| Title: | ||
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Exhibit B
Notice of Exercise
| To: | Quantum Materials Corp. |
| 0000 Xxxxxx Xxxx | |
| Xxx Xxxxxx, Xxxxx 00000 | |
| Attn: Sri Peruvemba, Chief Executive Officer |
The undersigned Holder hereby elects to purchase 1,250,000 Shares of Quantum Materials Corp. (the “Company”) pursuant to the terms of that certain Common Stock Purchase Warrant, dated January 31, 2014 (the “Warrant”) and the terms of the Agreement, dated October ___, 2016, by and among the Company, Xxxxxx Haysco Holdings, LP and Xxxxxx Diversified Investments, LP (the “Agreement”). The payment of the Exercise Price (as set forth in the Warrant) shall be the cancellation of the remaining warrants to acquire Shares of the Company under the Warrant.
Please issue a certificate or certificates representing said Shares in the name of the undersigned or in such other name as is specified below:
_________________________________________
(Name)
_________________________________________
_________________________________________
(Address)
| XXXXXX DIVERSIFIED INVESTMENTS, LP | ||
| By: | ||
| Its General Partner | ||
| By: | ||
| Name: | ||
| Title: | ||
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