Contract
Exhibit 10.2
THIS ASSET PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of October 25, 2017 among GENEXOSOME TECHNOLOGIES INC., a Nevada corporation (“Buyer”) and Xx Xxxx (the “Seller”).
WHEREAS, the Seller is engaged in the business of researching, developing and commercializing exosome technologies (the “Business”); and
WHEREAS, the Seller desires to sell, and the Buyer desires to purchase and acquire all of the Assets (as hereinafter defined) including, without limitation, all intellectual property and contractual rights and the other assets either designated in this Agreement and/or utilized in the Seller’s Business;
NOW, THEREFORE, in consideration of the mutual benefits to be derived from this Agreement and the representations, warranties, covenants, agreements, conditions and promises contained herein and therein, the parties hereto hereby agree as follows:
ARTICLE 1.
(a) All industrial and intellectual property rights, including, without limitation, those certain patents set forth on Schedule 1.1(a), all other patents not specifically set forth herein, patent applications, patent rights, trademarks, trademark applications, trade names, service marks, service xxxx applications, copyrights, copyright registrations, copyright applications, franchises, licenses, databases, “URL’s” and Internet domain names and applications therefor (and all interest therein), computer programs and other computer software, user interfaces, know-how, trade secrets, customer lists, proprietary technology, processes and formulae, source code, object code, algorithms, architecture, structure, display screens, layouts, development tools, instructions, templates, marketing materials, inventions, trade dress, logos and designs and all documentation and media constituting, describing or relating to the foregoing (“Intellectual Property Rights”);
(b) all equipment and tangible personal property owned or leased by the Seller);
(c) the unused brochures, literature, advertising, catalogues, photographs, display materials, media materials, packaging materials and other similar items which have been produced by or for the Seller;
(d) the photographs, display materials, media materials, packaging materials, business plans, presentations, and other similar items which have been produced by or for the Seller;
(e) the goodwill of the Seller in connection with the Business and the exclusive right to represent itself as carrying on the Business in succession to Seller; and
(f) all other assets (i.e., other than as described above and properties of every nature whatsoever, without limitation, whether tangible and intangible, and wherever located of the Seller.
(a) It is expressly agreed and understood that the Buyer shall not assume any liabilities (collectively, the liabilities not being assumed by the Buyer are referred to herein as “Excluded Liabilities”). All responsibility with respect to all liabilities of the Seller including, but not limited to, the Excluded Liabilities, shall remain with the Seller.
(b) The Buyer shall not assume or be bound by any obligations or liabilities of the Seller or any affiliate of the Seller of any kind or nature, known, unknown, accrued, absolute, contingent or otherwise, whether now existing or hereafter arising.
(c) The Seller shall be solely (as between the Seller and the Buyer) responsible for and pay any and all debts, losses, damages, obligations, liens, assessments, judgments, fines, disposal and other costs and expenses, liabilities and claims, including, without limitation, interest, penalties and fees of counsel and experts, as the same are incurred, of every kind or nature whatsoever made by or owed to any person.
(a) PAYMENT OF CONSIDERATION. The aggregate purchase price payable for the Assets consists of:
(i) an aggregate of $876,087 in cash (the “Cash Consideration”);
(ii) 500,000 shares of common stock, $0.0001 par value per share, of Avalon GloboCare Corp. (“Avalon”) held by the Buyer (the “Avalon Stock”);
(iii) 400 shares of common stock, $0.0001 par value per share, of the Buyer (together with the Avalon Stock, the “Stock Consideration”).
ARTICLE 2.
REPRESENTATIONS AND WARRANTIES
As used with respect to the Seller or the Buyer, as the case may be, the term “Material Adverse Effect” or “Material Adverse Change” means (i) any change, event, inaccuracy, violation, circumstance or effect, individually or in the aggregate, that has or is reasonably likely to have a material adverse effect on the business, assets (including intangible assets), operations, results of operations, properties or financial condition of the party and its subsidiaries taken as a whole, other than changes or effects (A) caused by changes in general economic or securities markets conditions, (B) that affect the business in which such party and its subsidiaries operate in general and that do not have a materially disproportionate effect on such party and its subsidiaries or (C) resulting from the announcement or proposed consummation of this Agreement and the transactions contemplated hereby (including any security holder class action litigation arising from allegations of a breach of fiduciary duty relating to this Agreement).
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(i) The Seller has good and valid title to, and owns free and clear of all encumbrances, has the exclusive right to use, sell, transfer, market, manufacture, license (or sublicense), deliver and dispose of, and has the right to bring actions for the infringement of, all Intellectual Property Rights (collectively, the “Seller Rights”).
(ii) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not breach, violate or conflict with any instrument or agreement governing any Seller Rights, will not cause the forfeiture or termination or give rise to a right of forfeiture or termination of any Seller Right or in any way impair the right of the Seller or the Buyer to use, sell, market, manufacture, license (or sublicense), deliver, dispose of, or to bring any action for the infringement of, any Seller Right or portion thereof.
(iii) There are no royalties, honoraria, fees or other payments payable by the Seller to any person by reason of the ownership, use, license (or sublicense), delivery, sale, or disposition of the Seller Rights, other than sales commissions paid in the ordinary course of business.
(iv) Neither the manufacture, marketing, license (or sublicense), sale, delivery, or use of any product or service currently or proposed to be licensed, sold, manufactured, marketed, delivered or used by the Seller or currently under development by the Seller, violates any license (or sublicense) or agreement of the Seller with any third party or, to the best knowledge of the Seller, infringes any common law or statutory rights of any other party, including, without limitation, rights relating to defamation, contractual rights, Intellectual Property Rights and rights of privacy or publicity; nor, to the best knowledge of the Seller, is any third party infringing upon, or violating any license (or sublicense), delivery or agreement with the Seller relating to any Seller Right; and there is no pending or, to the best knowledge of the Seller, threatened claim or litigation contesting the validity, ownership or right to use, manufacture, market, sell, license (or sublicense), deliver or dispose of any Seller Right, nor has the Seller received any notice asserting that any Seller Right or the proposed use, manufacture, marketing, sale, license (or sublicense), delivery or disposition thereof conflicts or will conflict with the rights of any other party.
(v) Other than professionals bound by ethical obligations of their profession not to disclose such information, all current and past officers, employees and consultants of or to the Seller have executed and delivered to and in favor of the Seller an agreement regarding the protection of confidential and proprietary information and the assignment to the Seller of all Intellectual Property Rights arising from the services performed for the Seller by such persons. The Seller has taken and will continue through the Closing Date to take all steps reasonably necessary, appropriate or desirable to safeguard and maintain the secrecy and confidentiality of, and its proprietary rights in, all Seller Rights.
(vi) All works that were created, prepared or delivered by consultants, independent contractors or other third parties for or on behalf of Seller (including any materials and elements created, prepared or delivered by such parties in connection therewith) (A) are and shall constitute “works made for hire” specially ordered or commissioned by the Seller within the meaning of United States’ copyright law, or (B) all right, title and interest therein (including any materials and elements created, prepared or delivered by such parties in connection therewith) have been assigned to the Seller.
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(vii) No person has any marketing rights to any of the Intellectual Property Rights of the Seller (excluding Intellectual Property Rights licensed to the Seller by third parties).
(viii) Schedule 1.1(a) of the Seller Disclosure Schedule contains a true and complete list of all (A) of the Seller’s patents, patent applications, patent design ideas, trademarks, trademark applications, trade names, service marks, service xxxx applications, copyrights, copyright registrations and copyright applications and Internet domain names and applications therefor and (B) other filings and formal actions made or taken pursuant to Federal, state, local and foreign laws by the Seller to perfect or protect its interest therein.
(d) LITIGATION, ETC. There are no (i) actions, suits, claims, investigations or legal or administrative or arbitration proceedings pending, or to the best knowledge of the Seller, threatened against the Seller, whether at law or in equity, or before or by any Federal, state, local, municipal, foreign or other governmental court, department, commission, board, bureau, agency or instrumentality (“Governmental Authority”), (ii) judgments, decrees, injunctions or orders of any Governmental Authority or arbitrator against the Seller or (iii) disputes with customers or vendors.
2.2. REPRESENTATIONS AND WARRANTIES OF THE BUYER.
The Buyer represents and warrants to the Seller as set forth below.
ARTICLE 3.
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(c) LEGAL ACTION. No temporary restraining order, preliminary injunction or permanent injunction or other order preventing the consummation of the transactions contemplated hereunder shall have been issued by any Federal or state court or other Governmental Authority and remain in effect.
(c) GOVERNMENT CONSENTS, AUTHORIZATIONS, ETC. Copies of all consents, authorizations, orders or approvals of, and filings or registrations with, any Governmental Authority which are required for or in connection with the execution and delivery by the Buyer of this Agreement and the consummation by the Buyer of the transactions contemplated hereby or thereby, shall have been delivered by the Buyer.
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ARTICLE 4.
4.1. RESTRICTIONS ON TRANSFER.
(a) The Stock Consideration to be issued to the Seller at the Closing Date shall not be sold, transferred, assigned, pledged, encumbered or otherwise disposed of (each, a “Transfer”) except upon the conditions specified in this Section 4.1, which conditions are intended to insure compliance with the provisions of the Securities Act. The Seller shall observe and comply with the Securities Act and the rules and regulations promulgated by the SEC thereunder as now in effect or hereafter enacted or promulgated, and as from time to time amended, in connection with any Transfer of the Stock Consideration beneficially owned by the Seller.
(b) Each certificate representing the Stock Consideration issued to the Seller and each certificate for such securities issued to subsequent transferees of any such certificate shall (unless otherwise permitted by the provisions of Section hereof) be stamped or otherwise imprinted with a legend in substantially the following form:
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES OR “BLUE-SKY” LAWS. THESE SECURITIES MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM.”
ARTICLE 5.
5.1. DEFINITIONS. As used in this Agreement, the following terms shall have the following meanings:
(a) “AFFILIATE” as to any person means any entity, directly or indirectly, through one or more intermediaries, controlling, controlled by or under common control with such person.
(b) “EVENT OF INDEMNIFICATION” shall mean the following:
(i) the untruth, inaccuracy or breach of any representation or warranty of the Seller (including the fact and circumstances underlying such untruth, inaccuracy or breach) contained in Section 2.1 of this Agreement, any Exhibit or Schedule hereto or any other document delivered in connection herewith or therewith (without giving effect to any “Material Adverse Effect” or other materiality qualification or any similar qualification contained or incorporated directly or indirectly in such representation or warranty);
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(ii) intentionally left blank;
(iii) the breach of any agreement or covenant of the Seller contained in this Agreement , any Exhibit hereto or any other document delivered in connection herewith or therewith;
(iv) the untruth, inaccuracy or breach of any representation or warranty of the Buyer (including the fact and circumstances underlying such untruth, inaccuracy or breach) contained in Section 2.2 of this Agreement, any Exhibit or Schedule hereto or any other document delivered in connection herewith (without giving effect to any “Material Adverse Effect” or other materiality qualification or any similar qualification contained or incorporated directly or indirectly in such representation or warranty) or
(v) the breach of any agreement or covenant of the Buyer contained in this Agreement, any Exhibit hereto or any document delivered in connection herewith.
(c) “INDEMNIFIED PERSONS” shall mean and include (A) with respect to an Indemnification Event described in subsections 5.1(b)(i) and 5.1(b)(iii) hereof (each a “Seller Event of Indemnification”), the Buyer and its Affiliates, successors and assigns, and the officers, directors and agents of the Buyer (the “Buyer Indemnified Persons”), or (B) with respect to an Indemnification Event described in subsections 5.1(b)(iv) and 5.1(b)(v) hereof (each, a “Buyer Event of Indemnification”), the Seller and their respective Affiliates, successors and assigns, and the respective officers, directors and agents of each of the foregoing (the “Seller Indemnified Persons”).
(d) “INDEMNIFYING PERSONS” shall mean and include (A) with respect to an Indemnification Event described in subsections 5.1(b)(i) and 5.1(b)(iii) hereof, the Seller and their respective successors, assigns, heirs and legal representatives and estates, as the case may be (the “Seller Indemnifying Persons”), and (B) with respect to an Indemnification Event described in subsections 5.1(b)(iv) and 5.1(b)(v) hereof, the Buyer and its successors and assigns (the “Buyer Indemnifying Persons”).
(e) “LOSSES” shall mean any and all losses, claims, damages, liabilities, expenses (including reasonable attorneys’, accountants’ and experts’ fees) sustained, suffered or incurred by any Indemnified Person arising from or in connection with any such matter that is the subject of indemnification under Section 5.2 hereof that shall not exceed the amount of any consideration actually paid by such Indemnifying Parties provided for hereunder.
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(a) The Indemnified Persons shall promptly give written notice to the Indemnifying Persons, as applicable, of any Third Party Claim that might give rise to any Loss by the Indemnified Persons, or any of them, stating the nature and basis of such Third Party Claim, and the amount thereof, to the extent known. Such notice shall be accompanied by copies of all relevant documentation with respect to such Third Party Claim, including, without limitation, any summons, complaint or other pleading that may have been served, any written demand or any other document or instrument. Notwithstanding the foregoing, the failure to provide notice as aforesaid will not relieve the Indemnifying Persons from any liability which they may have to the Indemnified Persons under this Agreement or otherwise (unless and only to the extent that such failure results in the loss or compromise of any rights or defenses of the Indemnifying Person and they were not otherwise aware of such action or claim).
(b) If the Indemnifying Person acknowledges in writing its obligation to indemnify the Indemnified Persons hereunder against any Losses that may result from such Third Party Claims, then the Indemnifying Person shall be entitled, at its option, to assume and control the defense of such Third Party Claim at its expense and through counsel of its reasonable choice if it gives notice to the Indemnified Persons within twenty (20) calendar days of the receipt of notice of such Third Party Claim from the Indemnified Persons of its intention to do so. If the Indemnifying Person elects to assume and control the defense of any such Third Party Claim, the Indemnified Persons shall have the right to employ separate counsel and to participate in (but not control) the defense, compromise or settlement of the Third Party Claim, but the fees and expenses of such counsel will be at the expense of the Indemnified Persons, unless (i) the Indemnifying Person has agreed to pay such fees and expenses, or (ii) the Indemnified Persons has been advised by its counsel that there may be one or more defenses reasonably available to it which are different from or additional to those available to the Indemnifying Person, and in any such case that portion of the fees and expenses of such separate counsel that are reasonably related to matters covered by the indemnification provided by this Article 5 will be paid by the Indemnifying Person. Expenses of counsel to the Indemnified Persons shall be reimbursed on a current basis by the Indemnifying Person if there is no dispute as to the obligation of the Indemnifying Person to pay such amounts pursuant to this Article 7. In the event the Indemnifying Person exercises its right to undertake the defense against any such Third Party Claim as provided above, the Indemnified Persons shall cooperate with the Indemnifying Person in such defense and make available to the Indemnifying Person, at the Indemnifying Person’s expense, all witnesses, pertinent records, materials and information in its possession or under its control relating thereto as is reasonably required by the Indemnifying Person. Similarly, in the event the Indemnified Persons is, directly or indirectly, conducting the defense against any such Third Party Claim, the Indemnifying Person shall cooperate with the Indemnified Persons in such defense and make available to it, at the Indemnifying Person’s expense, all such witnesses, records, materials and information in its possession or under its control relating thereto as is reasonably required by the Indemnified Persons. No such Third Party Claim, except the settlement thereof which involves the payment of money only (by a party or parties other than the Indemnified Persons) and for which the Indemnified Persons is released by the third party claimant and is totally indemnified by the Indemnifying Person, may be settled by the Indemnifying Person without the written consent of the Indemnified Persons. No Third Party Claim which is being defended in good faith by the Indemnifying Person shall be settled by the Indemnified Persons without the written consent of the Indemnifying Person.
5.6. LIMITATION ON INDEMNIFICATION.
(i) Anything to the contrary contained in this Article 5 notwithstanding, the Indemnifying Persons shall not be obligated to indemnify the Indemnified Persons pursuant to this Article 5 with respect to any Losses pursuant to Section 5.2 until the aggregate amount of such Losses exceeds fifty thousand dollars ($50,000) (the “Basket Amount”), whereupon the Indemnifying Persons shall be obligated to indemnify the Indemnified Persons for all Losses in excess of the Basket Amount:
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(ii) Each Indemnifying Person’s liability for any Losses shall be limited to the amount of such Losses net of the difference between any insurance proceeds received by the Indemnified Person in respect thereof minus the amount of premiums paid for such insurance by the Indemnified Person.
ARTICLE 6.
(a) if to the Buyer, to:
Genexosome Technologies Inc.
00 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xx. Xxxxx Xxx, CEO
with a copy (not constituting notice) to:
Xxxxxxx PLLC
00 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopier: (000) 000-0000
(b) if to the Seller, to:
Xx Xxxx
________________________
________________________
(c) All such notices or communications shall be deemed to be received (i) in the case of personal delivery or facsimile, on the date of such delivery, (ii) in the case of nationally-recognized overnight courier, on the next Business Day after the date when sent and (iii) in the case of mailing, on the third Business Day following the date on which the piece of mail containing such communication was posted.
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6.7. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey applicable to contracts made and to be performed wholly therein (without regard to principles of conflicts of laws).
6.13. CONSENT TO JURISDICTION; WAIVERS. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of New Jersey or in the federal courts located in the state and county of Monmouth. Each of the parties hereto further agrees that service of any process, summons, notice or document by U.S. registered mail to such party’s respective address set forth in Section 6.5 shall be effective service of process for any Action in New Jersey with respect to any matters to which it has submitted to jurisdiction in this Section 6.13. For purposes of this Agreement, “Action” means any claim, action, suit or arbitration, or any other proceeding, in each instance by or before any Governmental Authority or any nongovernmental arbitration, mediation or other nonjudicial dispute resolution body.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Asset Purchase Agreement to be executed on its behalf as of the day and year first above written.
| GENEXOSOME TECHNOLOGIES INC. | ||
| By: /s/ Xx. Xxxxx Xxx | ||
| Name: Xx. Xxxxx Xxx | ||
| Title: Chief Executive Officer | ||
| /s/ Yu Xxxx | ||
| Xx Xxxx |
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Schedule 1.1(a)
Patents
| CURRENT OWNED INTELLECTUAL PROPERTY in China (to be filed in USA) | |
| Application of an Exosomal MicroRNA in plasma as biomaker to diagnosis LIVER CANCER |
Patent application number: CN 2016 1 0675107.5 |
| Clinical application of circulating exosome carried xxXXX-33b in the diagnosis of liver cancer |
Patent application number: CN 2016 1 0675110.7 |
| Saliva Exosome based methods and composition for the Diagnosis, Staging and Prognosis of ORAL CANCER |
Patent application number: CN 0000 0 0000000.X |
| A novel exosome-based therapeutics against proliferative oral diseases |
Patent application number: CN 2017 1 0330835.7 |
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