Exhibit 10
SECURITIES EXCHANGE AGREEMENT
SECURITIES EXCHANGE AGREEMENT (the "Agreement") dated as of the 19th
day of July, 2006, by and among Global Immune Technologies Inc., a corporation
organized under the laws of the State of Wyoming, United States of America
("GIMU"), MedPri Limited, a company organized under the laws of England and
Wales ("MedPri"), Primedical International Ltd, a corporation organized under
the laws of Jersey ("PML"), and Medical Monitors Limited, a company organized
under the laws of Australia ("MML").
WITNESSETH:
WHEREAS, GIMU wishes to acquire from PML all of the issued and
outstanding stock of MEDPRI in exchange for shares of common stock and warrants
of GIMU, and an issue of convertible notes; and
WHEREAS, PML wishes to acquire from GIMU certain securities of GIMU in
exchange; and
WHEREAS, GIMU, MedPri, PML and MML are entering into this Agreement to
provide for such exchange and to establish various rights and obligations in
connection therewith, including the reorganization of the Board of Directors and
management of GIMU such that effective as of the closing of the transactions
contemplated hereby the Board of Directors of GIMU shall consist entirely of
Xxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxx Xxxxx, and Xxx Xxxxx, and that the Chief
Executive Officer shall be Xxxxx Xxxxxxx, and Don Perks shall remain as interim
Director for a six month period post signature of this agreement.
NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the parties hereto hereby agree as follows:
1. Exchange of Securities.
1.1 GIMU Consideration. On the terms and subject to the conditions set
forth in this Agreement; GIMU shall issue, convey and deliver to PML at Closing,
which shall occur on or before August 20, 2006, the following securities:
(a) Seventy-Four Million (74,000,000) shares of the Common
Stock of GIMU; which shares PML shall redistribute to its shareholders on a pro
rata basis.
(b) Seven Million Four Hundred Thousand (7,400,000) warrants,
each warrant representing the right to purchase one share of Common Stock of
GIMU for a price of Fifty Cents (US $0.50), valid for a period of 5 years from
the date of this Agreement; and
(c) A Promissory Note, bearing no interest, in the amount of
Ten Million United States Dollars ($10,000,000) payable automatically and
without demand on the third anniversary of the date of this Agreement, such note
to be convertible into shares of Common Stock of GIMU at the holder's option at
any time prior to the maturity date, such conversion to be at a price equal to
Eighty-Five Percent (85%) of the average closing price (meaning the price of the
last transaction booked during regular market hours, and exclusive of
after-hours trading), of GIMU Common stock over the immediately preceding five
business days. At no time shall such conversion price be less than Forty Cents
(US $ 0.40) or greater than One Dollar (US $ 1.00); and
(d) A Promissory Note issued to Medical Monitors Limited in
consideration for Intellectual Property, bearing no interest, in the amount of
Four Million United States Dollars ($4,000,000) payable automatically and
without demand on the first anniversary of the date of this Agreement, such note
to be convertible into shares of Common Stock of GIMU at the holder's option at
any time prior to the maturity date, such conversion to be at a price equal to
Eighty-Five Percent (85%) of the average closing price (meaning the price of the
last transaction booked during regular market hours, and exclusive of
after-hours trading), of GIMU Common stock over the immediately preceding five
business days. At no time shall such conversion price be less than Forty Cents
(US $ 0.40) or greater than One Dollar (US $1.00).
1.2 PML Consideration. In exchange for the issuance by GIMU to PML of
the GIMU Shares, Warrants and Promissory Notes, PML shall assign and convey to
GIMU all of its interest in Fifty eight million and three hundred and two
thousand (58,302,000) shares of the Common Stock of MEDPRI, such shares
constituting all of the outstanding capital stock of MEDPRI..
2. Representations and Warranties of GIMU. GIMU represents and warrants
to PML and MEDPRI as follows:
2.1 Due Organization. GIMU is a corporation duly organized, validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation, and has all requisite corporate power and authority to own,
operate, and lease its properties and assets and to conduct its business as now
conducted, and is qualified to do business in the state or other jurisdiction
where the nature of its properties, assets, or business requires such
qualification other than where the failure to be so qualified would not,
individually or in the aggregate, have a material adverse effect on the
condition, financial or otherwise, of the business of GIMU or its operations,
affairs, properties, or assets. GIMU is domiciled in the State of Wyoming, USA.
2.2 Compliance with Law. GIMU has obtained and maintains in full force
and effect all permits, licenses, consents, approvals, registrations,
memberships, authorizations, and qualifications under all federal, state, local,
and foreign laws and regulations, and with all federal, state, local, and
foreign governmental or regulatory authorities ("Authority") required for the
conduct by it of its business and the ownership or possession by it of its
properties and assets other than where the failure to obtain or maintain such
permits, licenses, consents, approvals, registrations, memberships,
authorizations, or qualifications could not, individually or in the aggregate,
have a material adverse effect on the condition of GIMU. GIMU is in compliance
with all laws, regulations, ordinances, orders, and decrees (including, without
limitation, all environmental and occupational, health, and safety laws) of any
governmental authority applicable to the conduct by GIMU of its business and to
its ownership and possession of its properties and assets other than where the
failure so to comply would not, individually or in the aggregate, have a
material adverse effect on the condition of GIMU.
2.3 Securities Regulation. GIMU has never been subject to any claim or
proceeding brought by any shareholder of it under any state or federal
securities laws. The common stock of GIMU is freely trading as a priced
quotation listed on the Over the Counter Bulletin Board of the National
Association of Securities Dealers and there is no investigation or inquiry by
the NASD, the U.S. Securities and Exchange Commission, or any state securities
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regulator relating to such stock or GIMU. GIMU has filed all reports and other
documents required to be filed by it with the SEC, the NASD and any state
securities regulator. The consummation of the transactions contemplated hereby
will have no effect on the continued public listing of GIMU common stock.
2.4 Authorization, Execution, and Delivery of Agreement.
(a) The execution and delivery of this Agreement, the issuance
of the securities designated herein to PML, and the consummation of the
transactions contemplated hereby (i) are within the corporate power and
authority of GIMU, (ii) do not require the approval or consent of any
stockholders of GIMU, and (iii) have been duly authorized by all necessary
corporate power on the part of GIMU. This Agreement has been duly authorized by
all necessary corporate power on the part of GIMU. This Agreement has been duly
executed and delivered by GIMU, and this Agreement constitutes the legal, valid,
binding, and enforceable obligation of GIMU.
(b) The shares of stock to be issued by GIMU pursuant to this
Agreement have been duly authorized by all necessary corporate action on the
part of GIMU and when they are issued shall be fully paid and nonassessable, and
PML will acquire valid title to such shares free and clear of any encumbrances.
2.5 Capitalization. The authorized capital stock of GIMU consists of an
unlimited number shares of shares of common stock, no par value per share, of
which 16,195,642 shares are issued and outstanding. All of the outstanding
equity securities of GIMU have been duly authorized and validly issued and are
fully paid and nonassessable. There are no contracts relating to the issuance,
sale, or transfer of any equity securities or other securities of GIMU. None of
the securities of GIMU was issued in violation of law.
2.6 Financial Statements. The Management Accounts attached hereto as
Schedule 2.5 (the "Management Accounts") present fairly the financial condition
and results of operations of the Business, as of the date thereof and for the
periods covered thereby.
2.7 Books and Records. The books of account and other financial records
of GIMU are complete and correct and represent actual, bona fide transactions
and have been maintained in accordance with sound business practices. The minute
books of GIMU are complete and accurate in all material respects, and contain
records of all meetings held (and consents in lieu of meetings executed by) the
shareholders and the board of directors of GIMU.
2.8 No Undisclosed Liabilities. GIMU has no liabilities or obligations
of any nature (whether known or unknown and whether absolute, accrued,
contingent, or otherwise) except for liabilities or obligations reflected or
reserved against in the Management Accounts.
2.9 Taxes.
(a) GIMU has duly filed or caused to be filed (or obtained
valid, currently effective extensions for filing) all federal, state, local and
foreign income, franchise, excise, payroll, sales and use, property, provider,
withholding and other tax returns, reports, estimates and information and other
statements or returns which are required to be filed by or on behalf of it
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pursuant to law ("Tax Returns"). All such Tax Returns were correct in all
respects as filed and reflect in all respects the federal, state, local and
foreign income, franchise, excise, payroll, sales and use, property, provider,
withholding and other taxes, duties, fees, imposts and governmental charges (and
charges in lieu of any thereof), together with interest, and additions to tax
and penalties required to be paid or collected by (or allocable to) GIMU
(collectively "Taxes"). GIMU (i) has paid or caused to be paid all taxes as
shown on the Tax Returns and on any assessment received by it and (ii) has
properly and fully recorded as accrued or deferred liabilities all taxes for any
period from the date of the last reporting period covered by such Tax Returns.
GIMU has not received any written notice of any audit, or any dispute or claim
being threatened by any relevant taxing authority concerning any Tax Return or
liability for taxes.
2.10 Legal Proceedings; Orders.
(a) There is no pending or, to GIMU's knowledge, threatened
proceeding:
(i) by or against GIMU or that otherwise relates to
or would reasonably be expected to affect its business, or
(ii) that challenges, or that will or could
reasonably be expected to prevent, delay, make illegal, or otherwise interfere
with, any of the transactions contemplated hereby.
(b) There is no order or group of orders issued by any
governmental agency to which GIMU or any of its assets is subject; and no
officer, director, agent, or employee of GIMU is subject to any Order that
prohibits such officer, director, agent, or employee from engaging in or
continuing any conduct, activity, or practice relating to the business of GIMU
in any material respect.
2.11 Absence of Certain Changes and Events. Since the date of the
Management Accounts, GIMU has conducted its business only in the ordinary course
of business and there has not been any:
(a) change in GIMU's authorized or issued capital stock; grant
of any stock option or right to purchase shares of capital stock of GIMU; or
issuance of any security convertible into such capital stock;
(b) amendment to the organizational documents of GIMU;
(c) payment (except in the ordinary course of business) or
increase by GIMU of any bonuses, salaries, or other compensation to any
shareholder, director, officer, or employee or entry into any employment,
severance, or similar Contract with any director, officer, or employee;
(d) adoption of, amendment to, or increase in the payments to
or benefits under, any Employee Plan;
(e) cancellation or waiver of any claims or rights of GIMU;
(f) change in the accounting methods used by GIMU; or
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(g) agreement, whether oral or written, by GIMU to do any of
the foregoing.
2.12 Disclosure.
(a) No representation or warranty or other statement made by
GIMU in this agreement omits to state a material fact necessary to make any of
them, in light of the circumstances in which it was made, not misleading.
(b) No additional information to be delivered by GIMU pursuant
to this Agreement will contain any untrue statement or omit to state a material
fact necessary to make the statements contained therein, in light of the
circumstances in which they were made, not misleading.
3. Representations and Warranties of MEDPRI. MEDPRI represents and
warrants to GIMU as follows:
3.1 Due Organization. MEDPRI is a corporation duly organized, validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation, and has all requisite corporate power and authority to own,
operate, and lease its properties and assets and to conduct its business as now
conducted, and is qualified to do business in the state or other jurisdiction
where the nature of its properties, assets, or business requires such
qualification other than where the failure to be so qualified would not,
individually or in the aggregate, have a material adverse effect on the
condition, financial or otherwise, of the business of MEDPRI or its operations,
affairs, properties, or assets.
3.2 Authorization, Execution, and Delivery of Agreement. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby (i) are within the corporate power and authority of MEDPRI,
(ii) do not require the approval or consent of any stockholders of MEDPRI which
has not been received, and (iii) have been duly authorized by all necessary
corporate power on the part of MEDPRI. This Agreement has been duly authorized
by all necessary corporate power on the part of MEDPRI. This Agreement has been
duly executed and delivered by MEDPRI, and this Agreement constitutes the legal,
valid, binding, and enforceable obligation of MEDPRI.
3.3 Capitalization. The issued capital stock of MEDPRI consists of
Fifty eight million and three hundred and two thousand (58,302,000) million
shares of Common Stock, par value (pound)0.01 (one xxxxx xxxxxxxx) per share.
All of the outstanding equity securities of MEDPRI have been duly authorized and
validly issued and are fully paid and nonassessable. There are no contracts
relating to the issuance, sale, or transfer of any equity securities or other
securities of MEDPRI. None of the securities of MEDPRI was issued in violation
of law. The stock records of MEDPRI indicate that PML is the owner of all of the
outstanding capital stock.
3.4 Disclosure.
(a) No representation or warranty or other statement made by
MEDPRI in this agreement omits to state a material fact necessary to make any of
them, in light of the circumstances in which it was made, not misleading.
(b) No additional information to be delivered by MEDPRI
pursuant to this Agreement will contain any untrue statement or omit to state a
material fact necessary to make the statements contained therein, in light of
the circumstances in which they were made, not misleading.
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4. Representations and Warranties of PML. PML represents and warrants
to GIMU as follows:
4.1 Due Organization. PML is a corporation duly organized, validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation.
4.2 Ownership of MEDPRI Common Stock. PML is the owner of Fifty eight
million and three hundred and two thousand (58,302,000) shares of the common
stock of MEDPRI, free and clear of any lien or encumbrance.
4.2 Authorization, Execution, and Delivery of Agreement.
(a) The execution and delivery of this Agreement, the
assignment and conveyance of the securities designated herein to GIMU, and the
consummation of the transactions contemplated hereby (i) are within the
corporate power and authority of PML, (ii) do not require the approval or
consent of any stockholders of GIMU which has not been obtained, and (iii) have
been duly authorized by all necessary corporate power on the part of PML. This
Agreement has been duly authorized by all necessary corporate power on the part
of PML. This Agreement has been duly executed and delivered by PML, and this
Agreement constitutes the legal, valid, binding, and enforceable obligation of
PML.
(b) The transfer of the shares of MEDPRI common stock to be
delivered by PML to GIMU pursuant to this Agreement has been duly authorized by
all necessary corporate action on the part of PML, and GIMU will acquire valid
title to such shares free and clear of any encumbrances.
4.3 Disclosure.
(a) No representation or warranty or other statement made by
PML in this agreement omits to state a material fact necessary to make any of
them, in light of the circumstances in which it was made, not misleading.
(b) No additional information to be delivered by PML pursuant
to this Agreement will contain any untrue statement or omit to state a material
fact necessary to make the statements contained therein, in light of the
circumstances in which they were made, not misleading.
5. Conditions Precedent Additional Agreements.
5.1 Reorganization of Management. GIMU hereby covenants and agrees to
deliver resignations of all directors and officers effective as of the closing,
and to cause the appointment of Xxxxx Xxxxx, Xxxxx Xxxxxxx and Xxxxx Xxxxx to
the board of directors and the appointment of Xxxxx Xxxxxxx as Chief Executive
Officer effective as of the closing.
5.2 Due Diligence. From and after the date hereof each of the parties
hereto will cooperate with and provide the other parties hereto with prompt
access to such information as such parties may reasonably request (and which is
in such party's possession or reasonably obtainable) in connection with their
ongoing due diligence investigations.
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5.3 Adjustment for Undisclosed Liabilities. In the event that, as of
the Closing, the liabilities and obligations of GIMU are in excess of those set
forth in the Management Account, MEDPRI and PML shall have the option of
terminating this agreement. In the event MEDPRI and PML elect not to terminate
this agreement, the number of shares of GIMU common stock to be delivered to PML
shall be increased as follows:
(i) The amount of the additional liabilities and/or
obligations shall be determined in U.S. dollars;
(ii) The number of shares of GIMU common stock that would be
equivalent in value to the additional liabilities and/or obligations, based on a
share price of Twelve Cents ($.12) per share, shall be calculated; and
(iii) This number of shares shall be multiplied by 5.57 (to
account for dilution), and the product shall be the number of additional shares
to be delivered by GIMU at the closing.
6. General Provisions.
6.1 Survival of Representations, Warranties and Agreement.
Notwithstanding any investigation conducted or notice or knowledge obtained by
or on behalf of any party hereto, the representation and warranty in this
Agreement shall survive the Closing.
6.2 Expenses. Each party hereto shall pay its, his or her own expenses
incidental to the preparation of this Agreement, the carrying out of the
provisions hereof, and the consummation of the transaction contemplated hereby.
6.3 Laws. This Agreement shall be governed and interpreted in
accordance with the laws of the State of Delaware, United States of America.
6.4. Entire Agreement. This Agreement constitutes the entire
understanding and agreement between the parties, and supersedes and integrates
all prior oral or written agreements, if any, and may only be modified by
written amendment signed by an authorized representative of each party.
6.5. No Conflicting Agreements. Each party states that there is no
agreement between itself and any other person, firm, or corporation that would
cause this Agreement not to have full force and effect.
* * * * *
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IN WITNESS WHEREOF, the parties have duly executed this Securities
Exchange Agreement as of the date first written above.
Global Immune Technologies Inc.
/s/ Don Perks
--------------------------------
Don Perks
Chief Executive Officer
Primedical International Limited
/s/ Xxxxx Xxxxx
--------------------------------
Xxxxx Xxxxx
Chief Executive Officer
MedPri Limited
/s/ Xxxx Xxxxxx
--------------------------------
Xxxx Xxxxxx
Director
Medical Monitors Limited
/s/ Xxxxx Xxxxx
--------------------------------
Xxxxx Xxxxx
Managing Director
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