SECURITIES EXCHANGE AGREEMENT
Exhibit 10.1
This
SECURITIES EXCHANGE AGREEMENT (this “Agreement”), dated as of
June 30, 2021, is entered into by and among Exactus, Inc., a Nevada corporation (the
“Parent”), Panacea Life
Sciences, Inc., a Colorado corporation (the “Company”), and the
shareholders of the Company who executed this Agreement (each a
“Shareholder” and
collectively the “Shareholders”). Each of
the parties to this Agreement is individually referred to herein as
a “Party” and collectively
as the “Parties.”
BACKGROUND
The
Parent has 650,000,000 shares of Common Stock, par value $0.0001
per share (the “Parent Common Stock”)
and 50,000,000 shares of Preferred
Stock, par value $0.0001 per share (the “Preferred
Stock”) authorized of
which 1,500,000 shares are designated as Series A Preferred Stock
(the “Series A
Preferred”), 32,000,000
shares are designated as Series B-1 Preferred Stock (the
“Series B-1
Preferred”) and
10,000,000 shares are designated as Series B-2 Preferred Stock (the
“Series B-2
Preferred”). As of the
date of this Agreement, 142,694,521 shares of Parent Common Stock,
450 shares of Series A Preferred and 1,500,000 shares of Series B-1
Preferred and 6,000,000 shares of Series B-2 Preferred are issued
and outstanding. 9,000,000 shares of Parent Common Stock may
be issued upon conversion of Series A Preferred, 187,000 shares of
Parent Common Stock may be issued upon conversion of Series B-1
Preferred, 750,000 shares of Parent Common Stock may be issued upon
conversion of Series B-2 Preferred.
The
Shareholders have agreed to transfer to Parent the shares of
capital stock of the Company owned by them as reflected on each
Shareholder’s signature page to this Agreement. In exchange
for the capital stock owned by the Shareholders, as of the closing
the Parent will issue an aggregate of: (A) 1,000,000 shares of newly issued shares of Series C
Convertible Preferred Stock, par value $0.0001 per share (the
“Parent C
Stock”) issuable to Xxxxxxx-MC, Incorporated, a
Colorado corporation (“Xxxxxxx”) (stated value
of $6,046,000) convertible into 64,098,172 shares of Common Stock;
(B) 10,000 shares of newly issued shares of Series C-1 Convertible
Preferred Stock, par value $0.0001 per share (stated value of
$2,812,500) (the “Parent C-1 Stock”)
issuable to Xxxxxxx convertible into 29,817,418 shares of Parent
Common Stock, (C) 10,000 shares of newly issued shares of Series D
Convertible Preferred Stock, par value $0.0001 per share (stated
value of $4,300,000) (the “Parent D Stock”) issuable
to J&N Real Estate Company, a Colorado limited liability
company convertible into 45,587,519 shares of Parent Common Stock
and (D) 473,639,756 shares of newly issued Parent Common Stock
(consisting of 298,174,177 shares issuable to Xxxxxxx, 20,143,322
shares issuable to Xxxxxx Xxxxxxxx, 91,016,026 shares issuable to
22nd Century Group, Inc. and 64,306,231 shares issuable to Company
employees) which together shall equal an aggregate of approximately
70.3% (the “Stated
Percentage”) of the issued and outstanding shares of
Parent Common Stock, on a fully diluted basis, (exclusive of
113,383,460 shares of Parent Common Stock reserved for issuance
under the Parent’s 2021 Equity Incentive Plan but inclusive
of shares issuable at Closing to various employees, directors,
advisors and consultants). Such Parent Common Stock, Parent C Stock
and Parent C-1 Stock and Parent D Stock, the “Parent Exchange Stock”.
The Shareholders hold all issued and outstanding shares of capital
stock in the Company.
The
Parent C Stock shall have such terms and rights as set forth in the
Certificate of Designation of Rights, Powers, Preferences,
Privileges and Restrictions of Series C Convertible Preferred
Stock, which shall include: (A) the right to vote on all matters
submitted to a vote of shareholders of Parent on an as converted
basis; and (B) for the Parent C Stock, the right to elect to
receive and be paid contingent liquidating and participation
payments in the amount of the Stated Value upon receipt of certain
recoveries set forth in the Certificate of Designation of
Preferences, Rights and Limitations of Series C Convertible
Preferred Stock in the form attached hereto as Exhibit A (the
“Series C
Certificate of Designations”). The Parent C-1 Stock
shall have such terms and rights as set forth in the Certificate of
Designation of Rights, Powers, Preferences, Privileges and
Restrictions of Series C-1 Convertible Preferred Stock in the form
attached hereto as Exhibit
A-1 (the “Series C-1 Certificate of
Designations”). The Parent D Stock shall have such
terms and rights as set forth in the Certificate of Designation of
Rights, Powers, Preferences, Privileges and Restrictions of Series
D Convertible Preferred Stock in the form attached hereto as
Exhibit A-2 (the
“Series D
Certificate of Designations” and together with the
Series C and C-1 Certificate of Designations, the
“Certificates of
Designations”).
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The
exchange of Company capital stock for Parent Exchange Stock is
intended to constitute a reorganization within the meaning of the
Internal Revenue Code of 1986, as amended (the “Code”), or such other tax
free reorganization or restructuring provisions as may be available
under the Code.
The
Board of Directors of each of the Parent and has determined, and
upon Closing, as defined, the Board of Directors of the Company
will have determined, that it is desirable to affect this plan of
reorganization and securities exchange.
AGREEMENT
NOW
THEREFORE, for good and valuable consideration the receipt and
sufficiency is hereby acknowledged, the Parties hereto intending to
be legally bound hereby agree as follows:
ARTICLE
I
Exchange
of Shares
SECTION
1.01. Exchange by the Shareholders.
At the Closing (as defined in Section 1.02), each Shareholder shall
sell, transfer, convey, assign and deliver to the Parent all of the
capital stock of the Company owned by such Shareholder (the
“Company
Shares”) as reflected on such Shareholder’s
signature page to this Agreement, free and clear of all Liens, as
defined below, in exchange for Parent Common Stock and Parent C
Stock, Parent C-1 Stock and Parent Series D Stock, as set forth on
Exhibit B, attached
hereto. In the event that the number of shares of Parent Common
Stock outstanding on a fully diluted basis exceeds 142,694,521, the
Shareholders shall be issued additional shares of Parent Common
Stock and, if the Shareholders are employees holding stock options
of the Company, stock options so that the Shareholders own the
Stated Percentage on a fully diluted basis immediately following
the Closing (exclusive of 113,383,460 shares of Parent Common Stock
reserved for issuance under the Parent’s 2021 Equity
Incentive Plan).
SECTION
1.02. Closing. The closing (the
“Closing”) of the
transactions contemplated by this Agreement (the
“Transactions”)
shall take place at such location to be determined by the Company,
Xxxxxx Xxxxxxxx (“the Principal Shareholder”) and the
Parent, commencing upon the satisfaction or waiver of all
conditions and obligations of the Parties to consummate the
Transactions contemplated hereby (other than conditions and
obligations with respect to the actions that the respective Parties
will take at Closing) or such other date and time as the Parties
may mutually determine (the “Closing
Date”).
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ARTICLE
II
Representations
and Warranties of the Shareholders
Each
Shareholder, individually and not jointly, and Xxxxxxx solely in
the case of Section 2.10. hereby represents and warrants to the
Parent, as follows:
SECTION
2.01. Good Title. The Shareholder is
the record and beneficial owner, and has good and marketable title
to its Company Shares, with the right and authority to sell and
deliver such Company Shares to the Parent as provided herein. The
Parent will receive good title to such Company Shares, free and
clear of all liens, security interests, pledges, equities and
claims of any kind, voting trusts, shareholder agreements and other
encumbrances other than restrictions imposed by applicable
securities laws (collectively, “Liens”).
SECTION
2.02. Power and Authority. All acts
required to be taken by the Shareholder to enter into this
Agreement and to carry out the Transactions have been properly
taken. This Agreement constitutes a legal, valid and binding
obligation of the Shareholder, enforceable against such Shareholder
in accordance with the terms hereof, except as such enforceability
may be limited by bankruptcy, insolvency, moratorium, and other
similar laws of general applicability and by general principles of
equity.
SECTION
2.03. No Conflicts. The execution and
delivery of this Agreement by the Shareholder and the performance
by the Shareholder of his, her or its obligations hereunder in
accordance with the terms hereof: (i) will not require the consent
of any third party or any federal, state, local or foreign
government or any court of competent jurisdiction, administrative
agency or commission or other governmental authority or
instrumentality, domestic or foreign (“Governmental Entity”)
under any statutes, laws, ordinances, rules, regulations, orders,
writs, injunctions, judgments, or decrees (collectively,
“Laws”); (ii) will not
violate any Laws applicable to such Shareholder; and (iii) will not
violate or breach any contractual obligation to which such
Shareholder is a party.
SECTION
2.04. No Finder’s Fee. The
Shareholder has not created any obligation for any finder’s,
investment banker’s or broker’s fee in connection with
the Transactions that the Company or the Parent will be responsible
for.
SECTION
2.05. Purchase Entirely for Own
Account. The Parent Exchange Stock proposed to be acquired
by the Shareholder hereunder will be acquired for investment for
such Shareholder’s own account, and not with a view to the
resale or distribution of any part thereof, and the Shareholder has
no present intention of selling or otherwise distributing the
Parent Exchange Stock or shares of Parent Common Stock issuable
upon conversion thereof (the “Parent Conversion
Shares”), except in compliance with applicable
securities laws.
SECTION
2.06. Available Information. The
Shareholder has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and
risks of an investment in the Parent. The Shareholder acknowledges
that it has had the opportunity to review the Parent’s
filings with the SEC which are available here: xxxxx://xxx.xxx.xxx/xxxxx/xxxxxx/?XXXx0000000.
SECTION
2.07. Non-Registration. The
Shareholder understands that the Parent Exchange Stock and the
Parent Conversion Shares have not been registered under the
Securities Act of 1933, as amended (the “Securities Act”) and, if
issued in accordance with the provisions of this Agreement, will be
issued by reason of a specific exemption from the registration
provisions of the Securities Act which depends upon, among other
things, the bona fide nature of the investment intent and the
accuracy of the Shareholder’s representations as expressed
herein.
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SECTION
2.08. Restricted Securities. The
Shareholder understands that the Parent Exchange Stock and the
Parent Conversion Shares are deemed “restricted
securities” under the Securities Act inasmuch as this
Agreement contemplates that, if acquired by the Shareholder
pursuant hereto, the Parent Exchange Stock and the Parent
Conversion Shares would be acquired in a transaction not involving
a public offering. The Shareholder further acknowledges that if the
Parent Exchange Stock and the Parent Conversion Shares are issued
to the Shareholder in accordance with the provisions of this
Agreement and the Certificates of Designations, such Parent
Exchange Stock and Parent Conversion Shares may not be resold
without registration under the Securities Act or the existence of
an exemption therefrom. The Shareholder represents that it is
familiar with Rule 144 promulgated under the Securities Act, as
presently in effect, and understands the resale limitations imposed
thereby and by the Securities Act.
SECTION
2.09. Legends. It is understood that
the Parent Exchange Stock and the Parent Conversion Shares will
bear the following legend or another legend that is similar to the
following:
NEITHER
THE SHARES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO
WHICH SUCH SHARES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SHARES REPRESENTED BY THIS CERTIFICATE AND THE SECURITIES
INTO WHICH SUCH SHARES ARE CONVERTIBLE 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
FORM ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD
PURSUANT TO RULE 144 UNDER SAID ACT.
and any
legend required by the “blue sky” laws of any state to
the extent such laws are applicable to the securities represented
by the certificate so legended.
SECTION
2.10 Shareholder Acknowledgment.
Xxxxxxx acknowledges that it has read the representations and
warranties of the Company set forth in Article III herein and such
representations and warranties are, to the best of its knowledge,
true and correct as of the date hereof.
ARTICLE
III
Representations
and Warranties of the Company
The
Company represents and warrants to the Parent, except as set forth
in the disclosure schedules provided in connection herewith, as
follows:
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SECTION
3.01. Organization, Standing and
Power. The Company is duly incorporated or organized,
validly existing and in good standing under the laws of the State
of Colorado and has the corporate power and authority and possesses
all governmental franchises, licenses, permits, authorizations and
approvals necessary to enable it to own, lease or otherwise hold
its properties and assets and to conduct its businesses as
presently conducted, other than such franchises, licenses, permits,
authorizations and approvals the lack of which, individually or in
the aggregate, has not had and would not reasonably be expected to
have a material adverse effect on the Company, its business,
results of operations, prospects, condition (financial or
otherwise) or assets or on the ability of the Company to perform
its obligations under this Agreement or to consummate the
Transactions (a “Company Material Adverse
Effect”). The Company is duly qualified to do business
in each jurisdiction where the nature of its business or its
ownership or leasing of its properties make such qualification
necessary, except where the failure to so qualify would not have a
Company Material Adverse Effect. The Company has delivered to the
Parent true and complete copies of the articles of incorporation
and bylaws of the Company, each as amended to the date of this
Agreement (as so amended, the “Company Charter
Documents”). The Company has no direct or indirect
subsidiaries.
SECTION
3.02. Capital Structure. The
authorized share capital of the Company is as set forth on
Schedule 3.02
annexed hereto. Other than set forth on Schedule 3.02, no shares or
other securities of the Company are issued, reserved for issuance
or outstanding. Except as set forth on Schedule 3.02, all outstanding
Company Shares are duly authorized, validly issued, fully paid and
non-assessable and not subject to or issued in violation of any
purchase option, call option, right of first refusal, preemptive
right, subscription right or any similar right under any provision
of the applicable corporate laws of its state of incorporation, the
Company Charter Documents or any Contract (as defined in Section
3.04) to which the Company is a party or otherwise bound. There are
no bonds, debentures, notes or other indebtedness of the Company
having the right to vote (or convertible into, or exchangeable for,
securities having the right to vote) on any matters on which
holders of Company Shares may vote (“Voting Company Debt”). As
of the date of this Agreement, except as set forth on Schedule 3.02, there are no
options, warrants, rights, convertible or exchangeable securities,
“phantom” stock rights, stock appreciation rights,
stock-based performance units, commitments, Contracts, arrangements
or undertakings of any kind to which the Company is a party or by
which the Company is bound (i) obligating the Company to issue,
deliver or sell, or cause to be issued, delivered or sold,
additional shares or other equity interests in, or any security
convertible or exercisable for or exchangeable into any shares or
capital stock or other equity interest in, the Company or any
Voting Company Debt, (ii) obligating the Company to issue, grant,
extend or enter into any such option, warrant, call, right,
security, commitment, Contract, arrangement or undertaking or (iii)
that give any person the right to receive any economic benefit or
right similar to or derived from the economic benefits and rights
occurring to holders of the shares or capital stock of the
Company.
Schedule 3.02 includes a true and complete copy of the
unaudited balance sheet of the Company (and subsidiaries) as of
December 31, 2020 and 2019, and the unaudited consolidated profit
and loss statement, statement of cash flow and statement of changes
in shareholders’ equity of the Company (and subsidiaries) for
the period ending on such dates, certified by such Company’s
chief executive officer or chief financial officer (collectively,
the “Financial
Statements”). The Financial Statements: (a) have been
prepared in accordance with the books of account and records of the
Company (and subsidiaries); (b) fairly present, and are true,
correct and complete statements in all material respects of the
consolidated financial condition of the Company (and subsidiaries)
and the results of its operations at the dates and for the periods
specified in those statements; and (c) have been prepared in
accordance with GAAP consistently applied with prior periods,
except that the Financial Statements are not accompanied by notes
and have not been reviewed or compiled by an independent
accountant. The Financial Statements will (a) be prepared in
accordance with the books of account and records of the Company
(and subsidiaries) and delivered on an estimated basis in
accordance with GAAP and (b) will be true, correct and complete
statements in all material respects of the consolidated financial
condition of the Company (and subsidiaries) as of the Closing
Date.
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SECTION
3.03. Authority; Execution and Delivery;
Enforceability. The Company has all requisite corporate
power and authority to execute and deliver this Agreement and to
consummate the Transactions. The execution and delivery by the
Company of this Agreement and the consummation by the Company of
the Transactions have been duly authorized and approved by a
majority of the Board of Directors of the Company. No corporate
proceedings on the part of the Company that have not already been
taken are necessary to authorize this Agreement and the
Transactions. When executed and delivered by the Parent and each
Shareholder, this Agreement will be enforceable against the Company
in accordance with its terms, subject to bankruptcy, insolvency and
similar laws of general applicability as to which the Company is
subject and subject to general principles of equity.
SECTION
3.04. No Conflicts;
Consents.
(a) The execution and
delivery by the Company of this Agreement does not, and the
consummation of the Transactions and compliance with the terms
hereof and thereof will not, conflict with, or result in any
violation of or default (with or without notice or lapse of time,
or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to loss of a
material benefit under, or result in the creation of any Lien upon
any of the properties or assets of the Company under any provision
of (i) the Company Charter Documents, except as disclosed on
Schedule 3.04, (ii)
any material contract, lease, license, indenture, note, bond,
agreement, permit, concession, franchise or other instrument (a
“Contract”) to which the
Company is a party or by which any of their respective properties
or assets is bound, except as disclosed on Schedule 3.04, or (iii) subject
to the filings and other matters referred to in Section 3.04(b),
any material judgment, order or decree (“Judgment”) or material
Law applicable to the Company or its properties or assets, other
than, in the case of clauses (ii) and (iii) above, any such items
that, individually or in the aggregate, have not had and would not
have a Company Material Adverse Effect.
(b) Except for required
filings with the Securities and Exchange Commission (the
“SEC”)
and applicable “Blue Sky” or state securities
commissions, no material consent, approval, license, permit, order
or authorization (“Consent”) of, or
registration, declaration or filing with, or permit from, any
Governmental Entity is required to be obtained or made by or with
respect to the Company in connection with the execution, delivery
and performance of this Agreement or the consummation of the
Transactions.
SECTION
3.05. Taxes.
(a) The Company has
timely filed, or has caused to be timely filed on its behalf, all
Tax Returns required to be filed by it, and all such Tax Returns
are true, complete and accurate, except to the extent any failure
to file or any inaccuracies in any filed Tax Returns, individually
or in the aggregate, have not had and would not have a Company
Material Adverse Effect. All Taxes shown to be due on such Tax
Returns, or otherwise owed, have been timely paid, except to the
extent that any failure to pay, individually or in the aggregate,
has not had and would not have a Company Material Adverse Effect.
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.
(b) If applicable, the
Company has established an adequate reserve reflected on its
financial statements for all Taxes payable by the Company (in
addition to any reserve for deferred Taxes to reflect timing
differences between book and Tax items) for all Taxable periods and
portions thereof through the date of such financial statements. No
deficiency with respect to any Taxes has been proposed, asserted or
assessed against the Company, and no requests for waivers of the
time to assess any such Taxes are pending, except to the extent any
such deficiency or request for waiver, individually or in the
aggregate, has not had and would not have a Company Material
Adverse Effect.
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(c) For purposes of
this Agreement:
“Taxes” includes all forms
of taxation, whenever created or imposed, and whether of the United
States or elsewhere, and whether imposed by a local, municipal,
governmental, state, foreign, federal or other Governmental Entity,
or in connection with any agreement with respect to Taxes,
including all interest, penalties and additions imposed with
respect to such amounts.
“Tax Return” means all
federal, state, local, provincial and foreign Tax returns,
declarations, statements, reports, schedules, forms and information
returns and any amended Tax return relating to Taxes.
SECTION
3.06. Benefit Plans. Except as set
forth on Schedule
3.06, the Company does not have or maintain any collective
bargaining agreement or any bonus, pension, profit sharing,
deferred compensation, incentive compensation, share ownership,
share purchase, share option, phantom stock, retirement, vacation,
severance, disability, death benefit, hospitalization, medical or
other plan, arrangement or understanding (whether or not legally
binding) providing benefits to any current or former employee,
officer or director of the Company (collectively,
“Company Benefit
Plans”). Except as set forth on Schedule 3.06, as of the date
of this Agreement there are no severance or termination agreements
or arrangements between the Company and any current or former
employee, officer or director of the Company, nor does the Company
have any general severance plan or policy.
SECTION
3.07. Litigation. Except as set forth
on Schedule 3.07,
there is no action, suit, inquiry, notice of violation, proceeding
(including any partial proceeding such as a deposition) or
investigation pending or to the Company’s knowledge,
threatened in writing against or affecting the Company, or any of
its properties before or by any court, arbitrator, governmental or
administrative agency, regulatory authority (federal, state,
county, local or foreign), stock market, stock exchange or trading
facility (“Action”) which (i)
adversely affects or challenges the legality, validity or
enforceability of any of this Agreement or the Parent Exchange
Stock or (ii) would, if there were an unfavorable decision,
individually or in the aggregate, be
reasonably expected to have or result in a Company Material
Adverse Effect. Neither the Company nor any director or officer
thereof (in his or her capacity as such), is or has been, since
January 1, 2019, the subject of any Action involving a claim or
violation of or liability under federal or state securities laws or
a claim of breach of fiduciary duty.
SECTION
3.08. Compliance with Applicable
Laws. The Company is in compliance with all applicable Laws,
including those relating to occupational health and safety and the
environment, except for instances of noncompliance that,
individually and in the aggregate, have not had and would not have
a Company Material Adverse Effect. This Section 3.08 does not
relate to matters with respect to Taxes, which are the subject of
Section 3.05.
SECTION
3.09. Brokers; Schedule of Fees and
Expenses. Except for those brokers as to which the Parent
shall be solely responsible, no broker, investment banker,
financial advisor or other person is entitled to any
broker’s, finder’s, financial advisor’s or other
similar fee or commission in connection with the Transactions based
upon arrangements made by or on behalf of the Company. The Parent
shall issue at Closing 500,000 shares of restricted Common Stock of
Parent to Paradox Capital Partners, LLC.
SECTION
3.10. Contracts. Except as disclosed
in Schedule 3.10,
there are no Contracts that are material to the business,
properties, assets, condition (financial or otherwise), results of
operations or prospects of the Company and its subsidiaries taken
as a whole. The Company is not in violation of or in default under
(nor does there exist any condition which upon the passage of time
or the giving of notice would cause such a violation of or default
under) any Contract to which it is a party or by which it or any of
its properties or assets is bound, except for violations or
defaults that would not, individually or in the aggregate, result
in a Company Material Adverse Effect.
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SECTION
3.11. Title to Properties. Except as
set forth on Schedule
3.11, the Company does not own any real property. The
Company has sufficient title to, or valid leasehold interests in,
all of its material properties and assets used in the conduct of
its businesses. All such assets and properties, other than assets
and properties in which the Company has leasehold interests, are
free and clear of all Liens other than those Liens that, in the
aggregate, do not and will not materially interfere with the
ability of the Company to conduct business as currently conducted
or as set forth on Schedule 3.11.
SECTION
3.12. Labor
Relations. No labor dispute
exists or, to the knowledge of the Company, is threatened with
respect to any of the employees of the Company, which would be
reasonably expected to result in a Company Material Adverse Effect.
None of the Company’s or its subsidiaries’ employees is
a member of a union that relates to such employee’s
relationship with the Company or such subsidiary, and neither the
Company nor any of its subsidiaries is a party to a collective
bargaining agreement, and the Company and its subsidiaries believe
that their relationships with their employees are good. To the
knowledge of the Company, no executive officer of the Company or
any subsidiary, is, or is now expected to be, in violation of any
material term of any employment contract, confidentiality,
disclosure or proprietary information agreement or non-competition
agreement, or any other contract or agreement or any restrictive
covenant in favor of any third party, and the continued employment
of each such executive officer does not subject the Company or any
of its subsidiaries to any liability with respect to any of the
foregoing matters. The Company and its subsidiaries are in
compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms
and conditions of employment and wages and hours, except where the
failure to be in compliance would not, individually or in the
aggregate, be reasonably expected to have a Company Material
Adverse Effect.
SECTION
3.13. Insurance. The Company holds
the insurance policies set forth on Schedule 3.13.
SECTION
3.14. Transactions With Affiliates and
Employees. Except as set forth on Schedule 3.14, none of the
officers or directors of the Company and, to the knowledge of the
Company, none of the employees of the Company is presently a party
to any transaction with the Company (other than for services as
employees, officers and directors), including any contract,
agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any
officer, director or such employee or, to the knowledge of the
Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director,
trustee or partner.
SECTION
3.15. Application of Takeover
Protections. The Company has taken all necessary action, if
any, in order to render inapplicable any control share acquisition,
business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under
the Company Charter Documents or the laws of its state of
incorporation that is or could become applicable to the
Shareholders as a result of the Shareholders and the Company
fulfilling their obligations or exercising their rights under this
Agreement, including, without limitation, the issuance of the
Parent Exchange Stock and the Shareholders’ ownership of the
Parent Exchange Stock.
SECTION
3.16. No Additional Agreements. The
Company does not have any agreement or understanding with any
Shareholder with respect to the Transactions other than as
specified in this Agreement or as reflected on Schedule 3.16.
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SECTION
3.17. Investment Company. The Company
is not, and is not an affiliate of, and immediately following the
Closing will not have become, an “investment company”
within the meaning of the Investment Company Act of 1940, as
amended.
SECTION
3.18. Disclosure. The Company
confirms that, except as set forth in this Agreement including the
disclosure schedules, neither it nor any person acting on its
behalf has provided the Parent or its respective agents or counsel
with any information that the Company believes constitutes
material, non-public information, except insofar as the existence
and terms of the Transactions may constitute such information. All
disclosure provided to the Parent regarding the Company, its
business and the Transactions, furnished by or on behalf of the
Company (including the Company’s representations and
warranties set forth in this Agreement) are true and correct in all
material respects and do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements made therein, in light of the circumstances
under which they were made, not misleading.
SECTION
3.19. Absence of Certain Changes or
Events. Except in connection with the Transactions and as
disclosed in the Company disclosure schedules, since January 1,
2021, the Company has conducted its business only in the ordinary
course, and during such period there has not been:
(a) any change in the
assets, liabilities, financial condition or operating results of
the Company, except changes in the ordinary course of business that
have not caused, in the aggregate, a Company Material Adverse
Effect, except as disclosed on Schedule 3.19;
(b) any damage,
destruction or loss, whether or not covered by insurance, that
would have a Company Material Adverse Effect;
(c) any waiver or
compromise by the Company of a valuable right or of a material debt
owed to it;
(d) any satisfaction or
discharge of any Lien or payment of any obligation by the Company,
except in the ordinary course of business and the satisfaction or
discharge of which would not have a Company Material Adverse
Effect;
(e) any material change
to a material Contract by which the Company or any of its assets is
bound or subject;
(f) any mortgage,
pledge, transfer of a security interest in, or Lien, created by the
Company, with respect to any of its material properties or assets,
except Liens for taxes not yet due or payable and Liens that arise
in the ordinary course of business and does not materially impair
the Company’s ownership or use of such property or
assets;
(g) any loans or
guarantees made by the Company to or for the benefit of its
employees, officers or directors, or any members of their immediate
families, other than travel advances and other advances made in the
ordinary course of its business;
(h) any alteration of
the Company’s method of accounting or the identity of its
auditors;
(i) any declaration or
payment of dividend or distribution of cash or other property to
the Shareholders or any purchase, redemption or agreements to
purchase or redeem any Company Shares;
-9-
(j) any issuance of
equity securities to any officer, director or affiliate;
or
(k) any arrangement or
commitment by the Company to do any of the things described in this
Section, except as disclosed on Schedule 3.19.
SECTION
3.20. Foreign Corrupt Practices.
Neither the Company, nor, to the Company’s knowledge, any
director, officer, agent, employee or other person acting on behalf
of the Company has, in the course of its actions for, or on behalf
of, the Company (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses
relating to political activity; (ii) made any direct or indirect
unlawful payment to any foreign or domestic government official or
employee from corporate funds; (iii) violated or is in violation of
any provision of the U.S. Foreign Corrupt Practices Act of 1977, as
amended; or (iv) made any unlawful bribe, rebate, payoff, influence
payment, kickback or other unlawful payment to any foreign or
domestic government official or employee.
SECTION
3.21 Compliance. Except as set forth on Schedule
3.21, neither the Company nor
any subsidiary: (i) is in default under or in violation of
(and no event has occurred that has not been waived that, with
notice or lapse of time or both, would result in a default by the
Company or any subsidiary under), nor has the Company or any
subsidiary received written notice of a claim that it is in default
under or that it is in violation of, any indenture, loan or credit
agreement or any other agreement or instrument to which it is a
party or by which it or any of its properties is bound (whether or
not such default or violation has been waived), (ii) is in
violation of any judgment, decree or order of any court, arbitrator
or other governmental authority or (iii) is or has been in
violation of any statute, rule, ordinance or regulation of any
governmental authority, including without limitation all foreign,
federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and
safety and employment and labor matters, except in each case of
clauses (i), (ii) or (iii) as would not be reasonably expected to
result in a Company Material Adverse Effect.
SECTION
3.22
Regulatory
Permits. The Company and its
subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state, local or foreign
regulatory authorities necessary to conduct their respective
businesses as described on the Company Disclosure Schedule, except
where the failure to possess such permits would not be reasonably
expected to result in a Company Material Adverse Effect
(“Material
Permits”), and neither
the Company nor any subsidiary has received any written notice of
proceedings relating to the revocation or modification of any
Material Permit.
SECTION
3.23 Intellectual
Property. The Company has, or
has rights to use, all patents, patent applications, trademarks,
trademark applications, service marks, trade names, trade secrets,
inventions, copyrights, licenses and other intellectual property
rights and similar rights necessary or required for use in
connection with their respective businesses and which the failure
to so have would reasonably be expected to have a Company Material
Adverse Effect (collectively, the “Intellectual Property
Rights”). All
Intellectual Property Rights are set forth on Schedule
3.23. None of, and neither the
Company nor any subsidiary has received a written notice that any
of, the Intellectual Property Rights has expired, terminated or
been abandoned, or is expected to expire or terminate or be
abandoned, within two (2) years from the date of this
Agreement. Neither the Company nor any subsidiary has received a
written notice of a claim or otherwise has any knowledge that the
Intellectual Property Rights violate or infringe upon the rights of
any person, except as would not be reasonably expected to have a
Company Material Adverse Effect. All such Intellectual Property
Rights are enforceable and there is no existing infringement by
another person of any of the Intellectual Property Rights. The
Company and its subsidiaries have taken reasonable security
measures to protect the secrecy, confidentiality and value of all
of their intellectual properties, except where failure to do so
would not, individually or in the aggregate, be reasonably expected
to have a Company Material Adverse Effect.
-10-
SECTION
3.24
Office of
Foreign Assets Control. Neither
the Company nor any of its subsidiaries nor, to the Company’s
knowledge, any director, officer, agent, employee or affiliate of
the Company is currently subject to any U.S. sanctions administered
by the Office of Foreign Assets Control of the U.S. Treasury
Department (“OFAC”).
SECTION
3.25
U.S. Real
Property Holding Corporation.
The Company is not and has never been a U.S. real property holding
corporation within the meaning of Section 897 of the Internal
Revenue Code of 1986, as amended.
Section
3.26
Bank
Holding Company Act. Neither
the Company nor any of its subsidiaries or affiliates is subject to
the Bank Holding Company Act of 1956, as amended (the
“BHCA”) and to regulation by the Board of Governors of
the Federal Reserve System (the “Federal Reserve”).
Neither the Company nor any of its subsidiaries or affiliates owns
or controls, directly or indirectly, five percent (5%) or more
of the outstanding shares of any class of voting securities or
twenty-five percent or more of the total equity of a bank or any
entity that is subject to the BHCA and to regulation by the Federal
Reserve. Neither the Company nor any of its subsidiaries or
affiliates exercises a controlling influence over the management or
policies of a bank or any entity that is subject to the BHCA and to
regulation by the Federal Reserve.
SECTION
3.27 Money
Laundering. The operations of
the Company and its subsidiaries are and have been conducted at all
times in compliance with applicable financial record-keeping and
reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, applicable money laundering
statutes and applicable rules and regulations thereunder
(collectively, the “Money Laundering
Laws”), and no action,
suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any
subsidiary with respect to the Money Laundering Laws is pending or,
to the knowledge of the Company or any subsidiary,
threatened
ARTICLE
IV
Representations
and Warranties of the Parent
The
Parent represents and warrants to the Shareholders and the Company,
that, except as set forth on a disclosure schedule or as described
in the reports, schedules, forms, statements and other documents
filed by the Parent with the SEC in 2021 (the “Parent SEC Documents”)
which shall be deemed included in any schedule hereto (the
“Parent Disclosure
Schedules”) as follows:
SECTION
4.01. Organization, Standing and
Power. The Parent is duly organized, validly existing and in
good standing under the laws of the State of Nevada and has full
corporate power and authority and possesses all governmental
franchises, licenses, permits, authorizations and approvals
necessary to enable it to own, lease or otherwise hold its
properties and assets and to conduct its businesses as presently
conducted, other than such franchises, licenses, permits,
authorizations and approvals the lack of which, individually or in
the aggregate, has not had and would not reasonably be expected to
have a material adverse effect on the Parent, its business, results
of operations, prospects, condition (financial or otherwise) or
assets or on the ability of the Parent to perform its obligations
under this Agreement or to consummate the Transactions (a
“Parent Material
Adverse Effect”). The Parent is duly qualified to do
business in each jurisdiction where the nature of its business or
their ownership or leasing of its properties make such
qualification necessary and where the failure to so qualify would
have a Parent Material Adverse Effect. The Parent has delivered to
the Company true and complete copies of the articles of
incorporation of the Parent, as amended to the date of this
Agreement (as so amended, the “Parent Charter”), and the
Bylaws of the Parent, as amended to the date of this Agreement (as
so amended, the “Parent
Bylaws”).
-11-
SECTION
4.02. Subsidiaries; Equity Interests.
Except as set forth on Schedule 4.02, the Parent does
not own, directly or indirectly, any capital stock, membership
interest, partnership interest, joint venture interest or other
equity interest in any person.
SECTION
3.03. Capital Structure. The
authorized capital stock of the Parent consists of Six Hundred and
Fifty Million (650,000,000) shares of Parent Common Stock, par
value $0.0001 per share, and Fifty Million (50,000,000) shares
of preferred stock, par value $0.0001 per share, of which (i)
56,356,431 shares of Parent Common Stock are issued and outstanding
as of December 31, 2020 and 111,859,759 shares are issued and
outstanding as of the date of this Agreement, and (ii) the following
shares of preferred stock of the Parent are issued and outstanding
as of the date of this Agreement: (A) 450 shares of Series A
Preferred Stock, which are convertible to 9,000,000 shares of
Parent Common Stock; (B) 1,500,000 shares of Series B-1 Preferred
Stock, which are convertible into 187,000 shares of Parent Common
Stock; (C) 6,000,000 shares of Series B-2 Preferred Stock, which
are convertible to 750,000 shares of Parent Common Stock. Except as
set forth on Schedule
4.03, no other shares of capital stock or other securities
of the Parent were issued, reserved for issuance or outstanding.
All outstanding shares of the capital stock of the Parent are, duly
authorized, validly issued, fully paid and non-assessable and not
subject to or issued in violation of any purchase option, call
option, right of first refusal, preemptive right, subscription
right or any similar right under any provision of the Nevada
Revised Statutes, the Parent Charter, the Parent Bylaws or any
Contract to which the Parent is a party or otherwise bound. Except
as set forth on Schedule
4.03, there are no bonds, debentures, notes or other
indebtedness of the Parent having the right to vote (or convertible
into, or exchangeable for, securities having the right to vote) on
any matters on which holders of capital stock of the Parent may
vote (“Voting Parent
Debt”). The Company has no outstanding indebtedness
except as disclosed on Schedule 4.03. Except in
connection with the Transactions as of the date of this Agreement,
there are no options, warrants, rights, convertible or exchangeable
securities, “phantom” stock rights, stock appreciation
rights, stock-based performance units, commitments, Contracts,
arrangements or undertakings of any kind to which the Parent is a
party or by which it is bound (i) obligating the Parent to issue,
deliver or sell, or cause to be issued, delivered or sold,
additional shares of capital stock or other equity interests in, or
any security convertible or exercisable for or exchangeable into
any capital stock of or other equity interest in, the Parent or any
Voting Parent Debt or indebtedness, (ii) obligating the Parent to
issue, grant, extend or enter into any such option, warrant, call,
right, security, commitment, Contract, arrangement or undertaking
or (iii) that give any person the right to receive any economic
benefit or right similar to or derived from the economic benefits
and rights occurring to holders of the capital stock of the Parent.
As of the date of this Agreement, there are no outstanding
contractual obligations of the Parent to repurchase, redeem or
otherwise acquire any shares of capital stock of the Parent. Other
than as set forth on Schedule 4.03, the Parent is
not a party to any agreement granting any security holder of the
Parent the right to cause the Parent to register shares of the
capital stock or other securities of the Parent held by such
security holder under the Securities Act. The stockholder list
provided to the Company is a current stockholder list generated by
its stock transfer agent, and such list accurately reflects all of
the issued and outstanding shares of the capital stock of the
Parent as at the Closing.
SECTION
4.04. Authority; Execution and Delivery;
Enforceability. The execution and delivery by the Parent of
this Agreement and the consummation by the Parent of the
Transactions have been duly authorized and approved by the Board of
Directors of the Parent and no other corporate proceedings on the
part of the Parent are necessary to authorize this Agreement and
the Transactions. This Agreement constitutes a legal, valid and
binding obligation of the Parent, enforceable against the Parent in
accordance with the terms hereof.
-12-
SECTION
4.05. No Conflicts;
Consents.
(a) The execution and
delivery by the Parent of this Agreement, does not, and the
consummation of Transactions and compliance with the terms hereof
and thereof will not, conflict with, or result in any violation of
or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to loss of a material benefit
under, or to increased, additional, accelerated or guaranteed
rights or entitlements of any person under, or result in the
creation of any Lien upon any of the properties or assets of the
Parent under, any provision of (i) the Parent Charter or Parent
Bylaws, (ii) any material Contract to which the Parent is a party
or by which any of its properties or assets is bound or (iii)
subject to the filings and other matters referred to in Section
4.05(b), any material Judgment or material Law applicable to the
Parent or its properties or assets, other than, in the case of
clauses (ii) and (iii) above, any such items that, individually or
in the aggregate, have not had and would not have a Parent Material
Adverse Effect.
(b) No Consent of, or
registration, declaration or filing with, or permit from, any
Governmental Entity is required to be obtained or made by or with
respect to the Parent in connection with the execution, delivery
and performance of this Agreement or the consummation of the
Transactions, other than the (A) filing with the SEC of a Current
Report on Form 8-K disclosing the Transactions contemplated hereby,
including all required exhibits thereto; (B) filing with the SEC of
a notice of an exempt offering of securities on Form D; and (C)
filings under state “blue sky” laws, as each may be
required in connection with this Agreement and the
Transactions.
SECTION
4.06. SEC Documents; Undisclosed
Liabilities.
(a) The Parent has
timely filed all Parent SEC Documents for the prior two fiscal
years and the current year, pursuant to Sections 13 and 15 of the
Exchange Act, as applicable.
(b) As of its
respective filing date, each Parent SEC Document complied in all
material respects with the requirements of the Exchange Act and the
rules and regulations of the SEC promulgated thereunder and the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations
promulgated thereunder, in each case applicable to such Parent SEC
Document, and did not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
Except to the extent that information contained in any Parent SEC
Document has been revised or superseded by a later filed Parent SEC
Document, none of the Parent SEC Documents contains any untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading. The financial statements of the Parent
included in the Parent SEC Documents comply as to form in all
material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto,
have been prepared in accordance with the U.S. generally accepted
accounting principles (“GAAP”) (except, in the case of
unaudited statements, as permitted by the rules and regulations of
the SEC) applied on a consistent basis during the periods involved
(except as may be indicated in the notes thereto) and fairly
present the financial position of Parent as of the dates thereof
and the results of its operations and cash flows for the periods
shown (subject, in the case of unaudited statements, to normal
year-end audit adjustments). To the Parent’s knowledge, none
of its filings with the SEC is the subject of an ongoing SEC
review, inquiry or investigation, and there are no outstanding or
unresolved SEC comments related to such filings.
-13-
(c) Except as set forth
in the Parent SEC Documents or on Schedule 4.06, the Parent has
no liabilities or obligations of any nature (whether accrued,
absolute, contingent or otherwise) required by GAAP to be set forth
on a balance sheet of the Parent or in the notes thereto. The
Parent SEC Documents, as modified by Schedule 4.06 sets forth all
financial and contractual obligations and liabilities (including
any obligations to issue capital stock or other securities of the
Parent) due after the date hereof.
SECTION
4.07. Information Supplied. None of
the information supplied or to be supplied by the Parent for
inclusion or incorporation by reference in any Parent SEC Document
or report contains any untrue statement of a material fact or omits
to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they are made, not
misleading.
SECTION
4.08. Absence of Certain Changes or
Events. Except as disclosed in the Parent Disclosure
Schedules, from the date of the most recent audited financial
statements included in the filed Parent SEC Documents to the date
of this Agreement, the Parent has conducted its business only in
the ordinary course, and during such period there has not
been:
(a) any change in the
assets, liabilities, financial condition or operating results of
the Parent from that reflected in the Parent SEC Documents, except
changes in the ordinary course of business that have not caused, in
the aggregate, a Parent Material Adverse Effect;
(b) any damage,
destruction or loss, whether or not covered by insurance, that
would have a Parent Material Adverse Effect;
(c) any waiver or
compromise by the Parent of a valuable right or of a material debt
owed to it;
(d) any satisfaction or
discharge of any Lien or payment of any obligation by the Parent,
except in the ordinary course of business and the satisfaction or
discharge of which would not have a Parent Material Adverse
Effect;
(e) any material change
to a material Contract by which the Parent or any of its assets is
bound or subject;
(f) any material change
in any compensation arrangement or agreement with any employee,
officer, director or stockholder;
(g) any resignation or
termination of employment of any officer of the
Parent;
(h) any mortgage,
pledge, transfer of a security interest in, or Lien, created by the
Parent, with respect to any of its material properties or assets,
except Liens for taxes not yet due or payable and Liens that arise
in the ordinary course of business and do not materially impair the
Parent’s ownership or use of such property or
assets;
(i) any loans or
guarantees made by the Parent to or for the benefit of its
employees, officers or directors, or any members of their immediate
families, other than travel advances and other advances made in the
ordinary course of its business;
(j) any declaration,
setting aside or payment or other distribution in respect of any of
the Parent’s capital stock, or any direct or indirect
redemption, purchase, or other acquisition of any of such stock by
the Parent;
-14-
(k) any alteration of
the Parent’s method of accounting or the identity of its
auditors;
(l) any issuance of
equity securities to any officer, director or affiliate, except
pursuant to existing Parent stock option plans; or
(m) any arrangement or
commitment by the Parent to do any of the things described in this
Section 4.08.
SECTION
4.09. Taxes.
(a) The Parent has
timely filed, or has caused to be timely filed on its behalf, all
Tax Returns required to be filed by it, and all such Tax Returns
are true, complete and accurate, except to the extent any failure
to file, any delinquency in filing or any inaccuracies in any filed
Tax Returns, individually or in the aggregate, have not had and
would not reasonably be expected to have a Parent Material Adverse
Effect. All Taxes shown to be due on such Tax Returns, or otherwise
owed, has been timely paid, except to the extent that any failure
to pay, individually or in the aggregate, has not had and would not
have a Parent Material Adverse Effect.
(b) The most recent
financial statements contained in the Parent SEC Documents reflect
an adequate reserve for all Taxes payable by the Parent (in
addition to any reserve for deferred Taxes to reflect timing
differences between book and Tax items) for all Taxable periods and
portions thereof through the date of such financial statements. No
deficiency with respect to any Taxes has been proposed, asserted or
assessed against the Parent, and no requests for waivers of the
time to assess any such Taxes are pending, except to the extent any
such deficiency or request for waiver, individually or in the
aggregate, has not had and would not have a Parent Material Adverse
Effect.
(c) There are no Liens
for Taxes (other than for current Taxes not yet due and payable) on
the assets of the Parent. The Parent is not bound by any agreement
with respect to Taxes.
SECTION
4.10. Absence of Changes in Benefit
Plans. From the date of the most recent audited financial
statements included in the Parent SEC Documents to the date of this
Agreement, there has not been any adoption or amendment in any
material respect by Parent of any collective bargaining agreement
or any bonus, pension, profit sharing, deferred compensation,
incentive compensation, stock ownership, stock purchase, stock
option, phantom stock, retirement, vacation, severance, disability,
death benefit, hospitalization, medical or other plan, arrangement
or understanding (whether or not legally binding) providing
benefits to any current or former employee, officer or director of
Parent (collectively, “Parent Benefit Plans”).
Except as set forth in the Parent SEC Documents, as of the date of
this Agreement there are not any employment, consulting,
indemnification, severance or termination agreements or
arrangements between the Parent and any current or former employee,
officer or director of the Parent, nor does the Parent have any
general severance plan or policy.
SECTION
4.11. ERISA Compliance; Excess Parachute
Payments. The Parent does not, and since its inception never
has, maintained, or contributed to any “employee pension
benefit plans” (as defined in Section 3(2) of ERISA),
“employee welfare benefit plans” (as defined in Section
3(1) of ERISA) or any other Parent Benefit Plan for the benefit of
any current or former employees, consultants, officers or directors
of Parent.
-15-
SECTION
4.12. Litigation. Except as disclosed
on Schedule 4.12,
there is no Action which (i) adversely affects or challenges the
legality, validity or enforceability of any of this Agreement or
the Parent Exchange Stock or (ii) would, if there were an
unfavorable decision, individually or in the aggregate,
be reasonably expected to have
or result in a Parent Material Adverse Effect. Neither the Parent
nor any director or officer thereof (in his or her capacity as
such), is or has been the subject of any Action involving a claim
or violation of or liability under federal or state securities laws
or a claim of breach of fiduciary duty.
SECTION
4.13. Compliance with Applicable
Laws. Except as disclosed on Schedule 4.13, the Parent is in
compliance with all applicable Laws, including those relating to
occupational health and safety, the environment, export controls,
trade sanctions and embargoes, except for instances of
noncompliance that, individually and in the aggregate, have not had
and would not have a Parent Material Adverse Effect. Except as set
forth in the Parent SEC Documents, the Parent has not received any
written communication during the past two years from a Governmental
Entity that alleges that the Parent is not in compliance in any
material respect with any applicable Law. The Parent is in
compliance with all effective requirements of the Xxxxxxxx-Xxxxx
Act of 2002, as amended, and the rules and regulations thereunder,
that are applicable to it, except where such noncompliance would
not be reasonably expected to
have or result in a Parent Material Adverse Effect.
SECTION
4.14. Contracts. Except as disclosed
on Schedule 4.14, ,
there are no Contracts that are material to the business,
properties, assets, condition (financial or otherwise), results of
operations or prospects of the Parent taken as a whole. The Parent
is not in violation of or in default under (nor does there exist
any condition which upon the passage of time or the giving of
notice would cause such a violation of or default under) any
Contract to which it is a party or by which it or any of its
properties or assets is bound, except for violations or defaults
that would not, individually or in the aggregate, result in a
Parent Material Adverse Effect.
SECTION
4.15. Title to Properties. The Parent
has good title to, or valid leasehold interests in, all of its
properties and assets used in the conduct of its businesses. All
such assets and properties, other than assets and properties in
which the Parent has leasehold interests, are free and clear of all
Liens and except for Liens that, in the aggregate, do not and will
not materially interfere with the ability of the Parent to conduct
business as currently conducted. The Parent has complied in all
material respects with the terms of all material leases to which it
is a party and under which it is in occupancy, and all such leases
are in full force and effect. The Parent enjoys peaceful and
undisturbed possession under all such material leases.
SECTION
4.16. Intellectual Property. The
Parent owns, or is validly licensed or otherwise has the right to
use, all Intellectual Property Rights which are material to the
conduct of the business of the Parent taken as a whole. No claims
are pending or, to the knowledge of the Parent, threatened that the
Parent is infringing or otherwise adversely affecting the rights of
any person with regard to any Intellectual Property Right. To the
knowledge of the Parent, no person is infringing the rights of the
Parent with respect to any Intellectual Property
Right.
SECTION
4.17. Labor Matters. There are no
collective bargaining or other labor union agreements to which the
Parent is a party or by which it is bound. No material labor
dispute exists or, to the knowledge of the Parent, is imminent with
respect to any of the employees of the Parent. To the Parent's
knowledge:
-16-
(a) no allegations of
sexual harassment, sexual misconduct or discrimination, whether
such discrimination arises from race, ethnic background, sex,
gender status, age or otherwise ("Misconduct") have been made
involving any current or former director, officer, or independent
contractor of the Parent or any of its subsidiaries,
(b) neither the Parent
nor any of its subsidiaries have entered into any settlement
agreements related to allegations of Misconduct by any current or
former director, officer, employee, or independent contractor of
the Parent or any of its subsidiaries.
SECTION
4.18. Transactions With Affiliates and
Employees. Except as set forth on Schedule 4.18, none of the
officers or directors of the Parent and, to the knowledge of the
Parent, none of the employees of the Parent is presently a party to
any transaction with the Parent or any subsidiary (other than for
services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or
from any officer, director or such employee or, to the knowledge of
the Parent, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director,
trustee or partner.
SECTION
4.19. Application of Takeover
Protections. The Parent has taken all necessary action, if
any, in order to render inapplicable any control share acquisition,
business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under
the Parent Charter, Parent Bylaws or the Laws of its state of
incorporation that is or could become applicable to the
Shareholders as a result of the Shareholders and the Parent
fulfilling their obligations or exercising their rights under this
Agreement, including, without limitation, the issuance of the
Parent Exchange Stock and the Shareholders’ ownership of the
Parent Exchange Stock.
SECTION
4.20. No Additional Agreements. The
Parent does not have any agreement or understanding with the
Shareholders with respect to the Transactions other than as
specified in this Agreement.
SECTION
4.21. Investment Company. The Parent
is not, and is not an affiliate of, and immediately following the
Closing will not have become, an “investment company”
within the meaning of the Investment Company Act of 1940, as
amended.
SECTION
4.22. Disclosure. The Parent confirms
that neither it nor any person acting on its behalf has provided
any Shareholder or its respective agents or counsel with any
information that the Parent believes constitutes material,
non-public information except insofar as the existence and terms of
the proposed transactions hereunder may constitute such information
and except for information that will be disclosed by the Parent
under a current report on Form 8-K filed after the Closing. All
disclosure provided to the Shareholders regarding the Parent, its
business and the transactions contemplated hereby, furnished by or
on behalf of the Parent (including the Parent’s
representations and warranties set forth in this Agreement) are
true and correct and do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements made therein, in light of the circumstances
under which they were made, not misleading.
SECTION
4.23. Accounts Payable. As of the
date of this Agreement, the accounts payable of the Parent
including any subsidiaries are listed on Schedule 4.23.
-17-
SECTION
4.24. Listing and Maintenance
Requirements. The Parent is, and has no reason to believe
that it will not in the foreseeable future continue to be, in
compliance with the listing and maintenance requirements for
continued listing of the Parent Conversion Shares on the trading
market on which the shares of Parent Common Stock are currently
listed or quoted (the OTCQB).
SECTION
4.25. Parent Exchange Stock. Upon
issuance to the Shareholders, the Parent Exchange Stock will be
duly and validly issued, fully paid and non-assessable shares of
Parent Common Stock and the preferred stock in the capital of the
Parent with such rights in case of the preferred stock as are set
forth in the Certificates of Designations therefor, copies of which
are attached as Exhibit
A and Exhibit
A-1.
SECTION
4.26. Brokers;
Fees and Expenses. No broker, investment banker, financial
advisor or other person is entitled to any broker’s,
finder’s, financial advisor’s or other similar fee or
commission in connection with the Transactions based upon
arrangements made by or on behalf of the Parent.
ARTICLE
V
Deliveries
SECTION
5.01. Deliveries of the
Shareholders.
(a) Concurrently
herewith the Shareholders are delivering to the Parent this
Agreement executed by the Shareholders.
(b) At or prior to the
Closing, unless waived by Parent, each Shareholder shall deliver to
the Parent:
(i)
This Agreement,
executed by the Shareholder; and
(ii)
this Agreement
which shall constitute a duly executed share transfer power for
transfer by the Shareholder of Company Shares to the Parent (which
Agreement shall constitute a limited power of attorney in the
Parent or any officer thereof to effectuate any share transfers as
may be required under applicable law, including, without
limitation, recording such transfer in the share registry
maintained by the Company for such purpose).
SECTION
5.02. Deliveries of the
Parent.
(a) Concurrently
herewith, the Parent is delivering to each Shareholder and to the
Company, a copy of this Agreement executed by the
Parent.
(b) At or prior to the
Closing, the Parent shall deliver to the Company:
(i)
A stamped copy of
the Certificate of Designations for each of the Parent C Stock and
the Parent C-1 Stock, each as filed with the Secretary of State of
the State of Nevada; and
(ii)
a good standing
certificate from the State of Nevada.
-18-
(c) Certificates for
the Parent C Stock, Parent C-1 Stock and Parent Common Stock shall
be delivered to each Shareholder (which delivery may be an
acknowledgement of issuance in book entry format) as set forth on
Exhibit
B.
SECTION
5.03. Deliveries of the
Company.
(a) Concurrently
herewith, the Company is delivering to the Parent this Agreement
executed by the Company.
(b) At or prior to the
Closing, the Company shall deliver to the Parent
(i)
a certificate
from the Company, signed by its Secretary or Assistant Secretary
certifying that the attached copies of the Company’s Charter
Documents and resolutions of the Board of Directors of the Company
approving this Agreement and the Transactions, are all true,
complete and correct and remain in full force and effect;
and
(ii)
A shareholder list,
certified by the Company’s Chief Executive Officer or Chief
Financial Officer.
ARTICLE
VI
Conditions
to Closing
SECTION
6.01. Shareholders and Company Conditions
Precedent. The obligations of each Shareholder and the
Company to enter into and complete the Closing is subject to the
fulfillment on or prior to the Closing Date of the following
conditions.
(a) Representations and Covenants.
The representations and warranties of the Parent contained in this
Agreement shall be true in all material respects (except for
representations and warranties qualified by materiality or Material
Adverse Effect which must be true in all respects) on and as of the
Closing Date with the same force and effect as though made on and
as of the Closing Date. The Parent shall have performed and
complied in all material respects with all covenants and agreements
required by this Agreement to be performed or complied with by the
Parent on or prior to the Closing Date. The Parent shall have
delivered to the Shareholder and the Company, a certificate, dated
the Closing Date, to the foregoing effect.
(b) Litigation. No action, suit or
proceeding shall have been instituted before any court or
governmental or regulatory body or instituted or threatened by any
governmental or regulatory body to restrain, modify or prevent the
carrying out of the Transactions or to seek damages or a discovery
order in connection with such Transactions, or which has or may
have, in the reasonable opinion of the Company or any Shareholder,
a Parent Material Adverse Effect.
(c) No Material Adverse Effect.
There shall not have been any occurrence, event, incident, action,
failure to act, or transaction since December 31, 2020 which has
had a Parent Material Adverse Effect.
(d) Post-Closing Capitalization.
At, and immediately after, the Closing, the authorized
capitalization, and the number of issued and outstanding shares of
capital stock of the Parent, on a fully-diluted basis, shall be as
described in this Agreement.
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(e) SEC Reports. The Parent shall
have filed all reports and other documents required to be filed by
the Parent under the U.S. federal securities laws through the
Closing Date.
(f) Nasdaq Listing. The Parent
shall have maintained its status as a company whose common stock is
listed on the OTCQB and promptly following the Closing Date shall
pursue listing on The Nasdaq Capital Market under its pending or a
new listing application and the Parent shall not have received any
notice that any reason shall exist as to why such status shall not
continue immediately following the Closing.
(g) Deliveries. The deliveries
specified in Section 5.02 shall have been made by the
Parent.
(h) No Suspensions of Trading in Parent
Common Stock; Listing. Trading in the Parent Common Stock
shall not have been suspended by the SEC or any trading market
(except for any suspensions of trading of not more than one trading
day solely to permit dissemination of material information
regarding the Parent) at any time since the date of execution of
this Agreement, and the Parent Common Stock shall have been at all
times since such date listed for trading on a trading
market.
(i) Satisfactory Completion of Due
Diligence. The Company and each Shareholder shall have
completed their legal, accounting and business due diligence of the
Parent and the results thereof shall be satisfactory to the Company
and each Shareholder in their sole and absolute
discretion.
(j) Employment. Xxxxxx Xxxxxxxx,
the Chief Executive Officer of the Company, shall be subject to an
agreement with Parent in form and substance satisfactory to Parent
providing for her services as Chief Executive Officer, for
protection from disclosure of confidential information, protection
of intellectual property and trade secrets, compliance with law,
and non-competition and non-raid substantially on the terms
applicable to Seller herein, during the term of employment and for
a period of 12 months thereafter.
(k) Board of Directors/Officers.
Each of the officers and directors of the Parent (except for Xx.
Xxxxx Xxxx) shall have resigned from all positions with the Parent
and any subsidiaries. On the Closing Date the Board of Directors of
Parent shall consist of two persons, consisting of Xxxxxx Xxxxxxxx
and Xxxxxxxx Xxxx. Xxxxxx Xxxxxxxx shall be appointed Chief
Executive Officer and each other officer of the Parent shall be
appointed by the Board effective as of the Closing
Date.
(l) Litigation. All litigation
involving the Parent or its subsidiaries shall have been settled,
which litigation is set forth on Schedule 6.01.
(m) Right of First Refusal. The
Company and the Shareholderss shall have terminated or waived all
right of first refusal under that certain Right of First Refusal
and Co-Sale Agreement, dated December 3, 2019, by and among the
Company, the investors named therein and certain key holders named
therein and the Founder Stock Purchase Agreement between the
Company and Xxxxxxx-MC, Incorporated dated October 20,
2017.
(n) Holders of the
Company’s existing stock options shall have executed
documents canceling each such holder’s stock
options.
(o) The Parent shall
have granted stock options to each holder referred to in Section
6.01(n) and such holders have executed Stock Option Agreements with
the Parent.
-20-
(p) Each Shareholder of
the Company has executed this Agreement unless waived by the
Principal Shareholder.
(q) The
Board of Directors of the Parent shall have reserved for issuance
such number of shares of Parent Common Stock as is necessary for
complete conversion of the Parent Preferred Stock to be issued to
the Shareholders subject to the 650 million limit contained in the
Company’s Articles of Incorporation.
(r) Omitted.
(r) All
Company indebtedness shall have been converted to Company capital
stock except as reflected on Schedule 6.02(u).
SECTION
..02. Parent Conditions Precedent.
The obligations of the Parent to enter into and complete the
Closing are subject, at the option of the Parent, to the
fulfillment on or prior to the Closing Date of the following
conditions, any one or more of which may be waived by the Parent in
writing.
(a) Representations and Covenants.
The representations and warranties of each Shareholder and the
Company contained in this Agreement shall be true in all material
respects (except for representations and warranties qualified by
materiality or Material Adverse Effect which must be true in all
respects) on and as of the Closing Date with the same force and
effect as though made on and as of the Closing Date. Such
Shareholder and the Company shall have performed and complied in
all material respects with all covenants and agreements required by
this Agreement to be performed or complied with by such Shareholder
and the Company on or prior to the Closing Date. The Company shall
have delivered to the Parent a certificate, dated the Closing Date,
to the foregoing effect.
(b) Litigation. No action, suit or
proceeding shall have been instituted before any court or
governmental or regulatory body or instituted or threatened by any
governmental or regulatory body to restrain, modify or prevent the
carrying out of the Transactions or to seek damages or a discovery
order in connection with such Transactions, or which has or may
have, in the reasonable opinion of the Parent, a materially adverse
effect on the assets, properties, business, operations or condition
(financial or otherwise) of the Company.
(c) No Material Adverse Change.
There shall not have been any occurrence, event, incident, action,
failure to act, or transaction since the date hereof which has had
a Company Material Adverse Effect.
(d) Deliveries. The deliveries
specified in Section 5.01 and Section 5.03 shall have been made by
each Shareholder and the Company, respectively.
(e) Post-Closing Capitalization.
At, and immediately after, the Closing, the authorized
capitalization, and the number of issued and outstanding shares of
the Company, on a fully-diluted basis, shall be described on
Exhibit
B.
(f) Employment. The
Principal Shareholder shall be subject to an agreement with Parent
in form and substance satisfactory to the Parent providing for the
continued services of the Chief Executive Officer, for protection
from disclosure of confidential information, protection of
intellectual property and trade secrets, compliance with law, and
non-competition and non-raid substantially during the term of her
employment and for a period of 12 months thereafter.
-21-
(g) Note Repayment. Except as
provided on Schedule
6.02(i), all indebtedness payable to the Principal
Shareholder or any affiliates including Xxxxxxx-MC, Incorporated
and its respective affiliates shall have been converted to Company
capital stock.
ARTICLE
VII
Covenants
SECTION
7.01. Public Announcements. The
Parent and the Company will consult with each other before issuing,
and provide each other the opportunity to review and comment upon,
any press releases or other public statements with respect to the
Agreement and the Transactions and shall not issue any such press
release or make any such public statement prior to such
consultation, except as may be required by applicable Law, court
process or by obligations pursuant to any listing agreement with
any national securities exchanges.
SECTION
7.02. Fees and Expenses. All fees and
expenses incurred in connection with this Agreement shall be paid
by the Party incurring such fees or expenses, whether or not this
Agreement is consummated.
SECTION
7.03. Continued Efforts. Each Party
shall use commercially reasonable efforts to (a) take all
action reasonably necessary to consummate the Transactions, and
(b) take such steps and do such acts as may be necessary to
keep all of its representations and warranties true and correct as
of the Closing Date with the same effect as if the same had been
made, and this Agreement had been dated, as of the Closing
Date.
SECTION
7.04. Exclusivity. Each of the Parent
and the Company shall not (and shall not cause or permit any of
their affiliates to) engage in any discussions or negotiations with
any person or take any action that would be inconsistent with the
Transactions and that has the effect of avoiding the Closing
contemplated hereby. Each of the Parent and the Company shall
notify each other immediately if any person makes any proposal,
offer, inquiry, or contact with respect to any of the
foregoing.
SECTION
7.05. Filing of 8-K and Press
Release. The Parent shall file, no later than four (4)
business days following execution of this Agreement and of the
Closing Date, a current report on Form 8-K with the SEC disclosing
the terms of this Agreement and other requisite disclosure
regarding the Transactions.
SECTION
7.06. Access. Each Party shall permit
representatives of any other Party to have full access to all
premises, properties, personnel, books, records (including Tax
records), contracts, and documents of or pertaining to such
Party.
SECTION
7.07. Preservation of Business. From
the date of this Agreement until the Closing Date, the Company
shall operate only in the ordinary and usual course of business
consistent with their respective past practices, and shall use
reasonable commercial efforts to (a) preserve intact their
respective business organizations, (b) preserve the good will and
advantageous relationships with customers, suppliers, independent
contractors, employees and other persons material to the operation
of their respective businesses, and (c) not permit any action or
omission that would cause any of their respective representations
or warranties contained herein to become inaccurate or any of their
respective covenants to be breached in any material
respect.
-22-
SECTION
7.08. Company Financial Statements.
Within seventy-one (71) days following the execution of this
Agreement, the Principal Shareholder shall cause the Company to
prepare and deliver to the Parent US GAAP audited financial
statements prepared by a PCAOB (Public Company Accounting Oversight
Board) firm in such form and for such periods as is required to be
filed in a Current Report on Form 8-K/A by the Parent to be filed
with the SEC following Closing (2 years) (the “Audited Financial
Statements”).
SECTION
7.09. Officers and Directors.
Following the Closing, the Parent shall promptly prepare an
Information Statement, file the Information Statement with the SEC
and comply with Rule 14f-1 under the Securities Exchange Act of
1934 to expand its Board of Directors to five people including
three new directors designated by the Principal
Shareholder.
SECTION
7.10. The Shareholders
shall authorize the amendment to the Articles of Incorporation of
Parent to and change the name of Parent (and trading symbol) to
Panacea Life Sciences Holdings, Inc. or such name as is determined
by the Principal Shareholder and agree to discontinue within three
months all use of any name similar to Exactus.
SECTION
7.11. Brokers/Finders. Parent shall
enter into one or more advisory agreements for consulting/advisory
services to be rendered by Paradox Capital Partners, LLC or
affiliates which provide for aggregate compensation for future
services as set forth in Section 3.09 hereof.
-23-
ARTICLE
VIII
Miscellaneous
SECTION
8.01. Notices. All notices, requests,
claims, demands and other communications under this Agreement shall
be in writing and shall be deemed given upon receipt by the Parties
at the following addresses (or at such other address for a Party as
shall be specified by like notice):
If to
the Parent, to:
00 XX
0xx
Xxxxxx, Xxxxx 00
Xxxxxx
Xxxxx, XX 00000
Attn:
Xxxxx Xxxx, Executive Chairman
_____________________
With a
copy to (which shall not constitute notice):
Xxxxx
Law Group
0 Xxxx
Xxxxxxx, Xxxxx 000,
Xxxx,
XX 00000
Cell
(000) 000-0000
Office
(000) 000-0000
Attn:
Xxx Xxxxxxx, Esq.
_____________________
If to
the Company, to:
Panacea
Life Sciences, Inc.
0000 X.
00xx
Xxxxx
Xxxxxx,
XX 00000
(000)
000-0000
Attn:
Xxxxxx Xxxxxxxx, CEO
______________________
With a
copy to (which shall not constitute notice):
Nason,
Yeager, Gerson, Harris & Fumero, P.A.
0000
XXX Xxxxxxxxx
Xxxxx
000
Xxxx
Xxxxx Xxxxxxx, XX 00000
Attn:
Xxxxxxx Xxxxxx
______________________
If to
the Shareholders at the addresses set forth in Exhibit B hereto.
SECTION
8.02. Amendments; Waivers; No Additional
Consideration. No provision of this Agreement may be waived
or amended except in a written instrument signed by the Company,
Parent and the Shareholders. No waiver of any default with respect
to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of
any subsequent default or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of
any Party to exercise any right hereunder in any manner impair the
exercise of any such right.
-24-
SECTION
8.03. Replacement of Securities. If
any certificate or instrument evidencing any Parent Exchange Stock
is mutilated, lost, stolen or destroyed, the Parent shall issue or
cause to be issued in exchange and substitution for and upon
cancellation thereof, or in lieu of and substitution therefore, a
new certificate or instrument, but only upon receipt of evidence
reasonably satisfactory to the Parent of such loss, theft or
destruction and customary and reasonable indemnity, if requested.
The applicants for a new certificate or instrument under such
circumstances shall also pay any reasonable third-party costs
associated with the issuance of such replacement Parent Exchange
Stock. If a replacement certificate or instrument evidencing any
Parent Exchange Stock is requested due to a mutilation thereof, the
Parent may require delivery of such mutilated certificate or
instrument as a condition precedent to any issuance of a
replacement.
SECTION
8.04. Remedies. In addition to being
entitled to exercise all rights provided herein or granted by law,
including recovery of damages, the Shareholders, Parent and the
Company will be entitled to specific performance under this
Agreement. The Parties agree that monetary damages may not be
adequate compensation for any loss incurred by reason of any breach
of obligations described in the foregoing sentence and hereby
agrees to waive in any action for specific performance of any such
obligation the defense that a remedy at law would be
adequate.
SECTION
8.05. Limitation of Liability.
Notwithstanding anything herein to the contrary, each of the Parent
and the Company acknowledge and agree that the liability of any
Shareholder arising directly or indirectly, under any transaction
document of any and every nature whatsoever shall be satisfied
solely out of the assets of that Shareholder, and that no trustee,
officer, other investment vehicle or any other affiliate of the
Shareholder or any investor, shareholder or holder of shares of
beneficial interest of the Shareholder shall be personally liable
for any liabilities of any other Shareholder.
SECTION
8.06. Interpretation. When a
reference is made in this Agreement to a Section, such reference
shall be to a Section of this Agreement unless otherwise indicated.
Whenever the words “include,” “includes” or
“including” are used in this Agreement, they shall be
deemed to be followed by the words “without
limitation.”
SECTION
8.07. Severability. If any term or
other provision of this Agreement is invalid, illegal or incapable
of being enforced by any rule or Law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal
substance of the Transactions contemplated hereby is not affected
in any manner materially adverse to any Party. Upon such
determination that any term or other provision is invalid, illegal
or incapable of being enforced, the Parties shall negotiate in good
faith to modify this Agreement so as to effect the original intent
of the Parties as closely as possible in an acceptable manner to
the end that Transactions contemplated hereby are fulfilled to the
extent possible.
SECTION
8.08. Counterparts; Facsimile
Execution. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts
have been signed by each of the Parties and delivered to the other
Parties. Facsimile execution and delivery of this Agreement is
legal, valid and binding for all purposes.
SECTION
8.09. Entire Agreement; No Third Party
Beneficiaries. This Agreement, taken together with the
Disclosure Schedules, (a) constitutes the entire agreement, and
supersede all prior agreements and understandings, both written and
oral, among the Parties with respect to the Transactions and (b)
are not intended to confer upon any person other than the Parties
any rights or remedies.
-25-
SECTION
8.10. Governing Law. This Agreement,
the legal relations between the parties and any Action, whether
contractual or non-contractual, instituted by any party with
respect to any matter arising between the parties, including but
not limited to matters arising under or in connection with this
Agreement, such as the negotiation, execution, interpretation,
coverage, scope, performance, breach, termination, validity, or
enforceability of this Agreement, shall be governed by and
construed in accordance with the internal laws of the State of
Nevada without reference to principles of conflicts of laws. The
parties hereto hereby irrevocably submit to the exclusive
jurisdiction of the courts of the State of Nevada and the Federal
Courts of the United States of America located within the Xxxxx
County, Nevada with respect to any matter arising between the
parties, and hereby waive, and agree not to assert, as a defense in
any action, suit or proceeding for the interpretation or
enforcement hereof or thereof, that it is not subject thereto or
that such action, suit or proceeding may not be brought or is not
maintainable in said courts or that the venue thereof may not be
appropriate or that this Agreement or any such document may not be
enforced in or by such courts, and the parties hereto irrevocably
agree that all claims with respect to such action or proceeding
shall be heard and determined in such a Nevada State or Federal
court. The parties hereby consent to and grant any such court
jurisdiction over the person of such parties and over the subject
matter of such dispute and agree that mailing of process or other
papers in connection with any such action or proceeding in any
manner as may be permitted by applicable Law, shall be valid and
sufficient service thereof. With respect to any particular action,
suit or proceeding arising between the parties, including but not
limited to matters arising under or in connection with this
Agreement, venue shall lie solely in Denver, Colorado or any
Federal Court of the United States of America sitting in the
District of Colorado.
SECTION
8.11. Assignment. Neither this
Agreement nor any of the rights, interests or obligations under
this Agreement shall be assigned, in whole or in part, by operation
of law or otherwise by any of the Parties without the prior written
consent of the other Parties. Any purported assignment without such
consent shall be void. Subject to the preceding sentences, this
Agreement will be binding upon, inure to the benefit of, and be
enforceable by, the Parties and their respective successors and
assigns.
-26-
IN
WITNESS WHEREOF, the parties hereto have executed and delivered
this Securities Exchange Agreement as of the date first above
written.
The
Parent:
By:
_____________________________
Name:
Xxxxx Xxxx
Title:
Executive Chairman
The
Company:
PANACEA
LIFE SCIENCES, INC.
By:
_____________________________
Name:
Xxxxxx Xxxxxxxx
Title:
CEO
The
Shareholders:
__________________________
By:
___________________________
Name:
_________________________
Title:
__________________________
-27-
