AMENDED AND RESTATED AGREEMENT AND PLAN OF SHARE EXCHANGE by and among AuraSound, Inc., a California corporation and the Shareholders of AuraSound, Inc., on the one hand; and Hemcure, Inc., an Nevada corporation, SBC Business Consulting, LLC, a...
AMENDED
AND RESTATED AGREEMENT AND PLAN OF SHARE EXCHANGE
by
and among
AuraSound,
Inc.,
a
California corporation
and
the
Shareholders of
AuraSound,
Inc.,
on
the one hand;
and
Hemcure,
Inc.,
an
Nevada
corporation,
SBC
Business Consulting, LLC,
a
Delaware limited liability company,
and
Xxxxxx
X.
Xxxxxxx,
an
individual,
on
the other hand
June
7,
2007
FINAL
AGREEMENT
AND PLAN OF SHARE EXCHANGE
This
Amended and Restated Agreement and Plan of Share Exchange, dated as of June
7,
2007 (this “Agreement”),
is
made and entered into by and among AuraSound, Inc., a California corporation
(“Aura
Sound”),
and
the shareholders of Aura Sound listed on Schedule I attached hereto (each,
an
“Aura
Sound Shareholder”,
collectively, the “Aura
Sound Shareholders”),
on
the one hand; and Hemcure, Inc., a publicly traded Nevada corporation (OTCBB:
HMCU) (“Hemcure”),
Synergy Business Consulting, LLC, a Delaware limited liability company and
the
majority shareholder of Hemcure (“SBC”),
and
Xxxxxx X. Xxxxxxx, the managing member of SBC (“Xxxxxxx”),
on
the other hand.
RECITALS
WHEREAS,
this Agreement amends and restates in its entirety the Agreement and Plan of
Share Exchange, dated as of February 16, 2007, by and among the parties to
this
Agreement.
WHEREAS,
the respective boards of directors of Hemcure and Aura Sound have adopted
resolutions approving and adopting the share exchange described in this
Agreement (the “Exchange”)
upon
the terms and conditions set forth herein;
WHEREAS,
the Exchange ratio is 1 share of Hemcure common stock for each share of Aura
Sound common stock;
WHEREAS,
after giving effect to a Share Cancellation Agreement to be entered into by
and
among Aura Sound, Xxxxxx Xxx and certain shareholders of Aura Sound (the
“Share
Cancellation Agreement”),
and a
Note Conversion Agreement and Release to be entered into by and among Aura
Sound
and certain promissory note holders of Aura Sound (the “Note
Conversion Agreement)”,
each
Aura Sound Shareholder owns the number of shares of common stock of Aura Sound
set forth opposite such Aura Sound Shareholder’s name in Column I on Schedule I
attached hereto (collectively, the “Aura
Sound Shares”);
WHEREAS,
the Aura Sound Shareholders own, collectively, an amount of shares of common
stock of Aura Sound constituting at least 90% of the issued and outstanding
capital stock of Aura Sound, and the Aura Sound Shareholders desire to exchange
their respective portions of the Aura Sound Shares pursuant to the terms and
conditions of this Agreement;
WHEREAS,
SBC and
Xxxxxxx will enter into this Agreement for the purpose of making certain
representations, warranties, covenants, indemnifications and
agreements;
WHEREAS,
Aura Sound will enter into this Agreement for the purpose of evidencing its
consent to the consummation of the Exchange and for the purpose of making
certain representations, warranties, covenants and agreements;
WHEREAS,
it
is
intended that the terms and conditions of this Agreement comply in all respects
with Section 368(a)(1)(B) of the Internal Revenue Code (the “Code”)
and
the regulations corresponding thereto, so that the Exchange shall qualify as
a
tax free reorganization under the Code;
NOW,
THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
FINAL
ARTICLE
1
THE
EXCHANGE
1.1 Exchange
of Shares.
Upon
the terms and subject to the conditions hereof, at the Closing the Aura Sound
Shareholders will sell, convey, assign, transfer and deliver to Hemcure stock
certificates representing the Aura Sound Shares, and Hemcure will issue to
each
Aura Sound Shareholder, in exchange for such Aura Sound Shareholder’s pro rata
portion of the Aura Sound Shares, one or more stock certificates representing
the number of shares of Hemcure common stock set forth opposite such Aura Sound
Shareholder’s name in Column II on Schedule I attached hereto (collectively, the
“Hemcure
Shares”).
The
aggregate number of Hemcure Shares to be issued to the Aura Sound Shareholders
will not exceed 11,505,305 shares of common stock.
1.2 Closing.
The
closing of the Exchange (the “Closing”)
shall
take place on the date when all of the closing conditions set forth in Article
7
of this Agreement are either satisfied or waived, or on such other date as
may
be mutually agreed upon by the parties. Such date is referred to herein as
the
"Closing
Date".
1.3 Articles
of Exchange.
Immediately following the Closing, Hemcure shall file Articles of Exchange
with
the Secretary of State of Nevada, in the form of Exhibit
A
hereto.
The transactions contemplated by this Agreement shall become effective at such
time as the Articles of Exchange are duly filed in the State of Nevada pursuant
to Section 92A.240 of the Nevada Revised Statutes.
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES OF AURA SOUND
Aura
Sound hereby represents and warrants to Hemcure as follows:
2.1
Organization.
Aura
Sound has been duly incorporated, is validly existing as a corporation and
is in
good standing under the laws of its jurisdiction of incorporation, and has
the
requisite power to carry on its business as now conducted.
2.2
Capitalization.
The
authorized capital stock of Aura Sound consists of 100,000,000 shares of common
stock, no par value, of which 11,505,305 shares will be issued and outstanding
at the Closing after giving effect to the Share Cancellation Agreement and
the
Note Conversion Agreement. All of the issued and outstanding shares of capital
stock of Aura Sound are duly authorized, validly issued, fully paid,
non-assessable and free of preemptive rights. There are no voting trusts or
any
other agreements or understandings with respect to the voting of Aura Sound's
capital stock.
2.3
Certain
Corporate Matters.
Aura
Sound is duly qualified to do business as a corporation and is in good standing
in each jurisdiction in which the ownership of its properties, the employment
of
its personnel or the conduct of its business requires it to be so qualified,
except where the failure to be so qualified would not have a material adverse
effect on Aura Sound's financial condition, results of operations or business.
Aura Sound has full corporate power and authority and all authorizations,
licenses and permits necessary to carry on the business in which it is engaged
and to own and use the properties owned and used by it.
FINAL
2.4
Authority
Relative to this Agreement.
Aura
Sound has the requisite power and authority to enter into this Agreement and
to
carry out its obligations hereunder. The execution, delivery and performance
of
this Agreement by Aura Sound and the consummation by Aura Sound of the
transactions contemplated hereby have been duly authorized by the board of
directors of Aura Sound and no other actions on the part of Aura Sound are
necessary to authorize this Agreement or the transactions contemplated hereby.
This Agreement has been duly and validly executed and delivered by Aura Sound
and constitutes a valid and binding agreement of Aura Sound, enforceable against
Aura Sound in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency or other similar laws affecting the
enforcement of creditors' rights generally or by general principles of
equity.
2.5
Consents
and Approvals; No Violations.
Except
for applicable requirements of federal securities laws and state securities
or
blue-sky laws, no filing with, and no permit, authorization, consent or approval
of, any third party, public body or authority is necessary for the consummation
by Aura Sound of the transactions contemplated by this Agreement. Neither the
execution and delivery of this Agreement by Aura Sound nor the consummation
by
Aura Sound of the transactions contemplated hereby, nor compliance by Aura
Sound
with any of the provisions hereof, will (a) conflict with or result in any
breach of any provisions of the charter or bylaws of Aura Sound, (b) result
in a
violation or breach of, or constitute (with or without due notice or lapse
of
time or both) a default (or give rise to any right of termination, cancellation
or acceleration) under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, contract, agreement or other instrument
or
obligation to which Aura Sound is a party or by which it or any of its
properties or assets may be bound or (c) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to Aura Sound, or any of its
properties or assets, except in the case of clauses (b) and (c) for violations,
breaches or defaults which are not individually or in the aggregate material
to
Aura Sound.
2.6 Financial
Statements.
(a) Aura
Sound has provided Hemcure with a copy of the audited balance sheet of Aura
Sound as at March 31, 2005 and 2006, and the related statement of operations,
stockholders’ equity and cash flows for the two fiscal years then ended,
together with the unqualified report thereon (except with respect to
continuation as a going concern) of Xxxxxx & Co., LLP (“Xxxxxx”),
independent auditors (collectively, “Aura
Sound’s Audited Financials”).
(b) Included
in Aura Sound’s Audited Financials are the unaudited balance sheet of Aura Sound
as at December 31, 2006, and the related statement of operations and cash flows
for the nine months then ended, as reviewed by Xxxxxx (“Aura
Sound’s Interim Financials”).
(c) Aura
Sound’s Audited Financials and Aura Sound’s Interim Financials (collectively
“Aura
Sound’s Financial Statements”)
(i)
are in accordance with the books and records of Aura Sound, (ii) are correct
and
complete in all material respects, (iii) fairly present the financial position
and results of operations of Aura Sound as of the dates indicated, and (iv)
are
prepared in accordance with U.S. GAAP (except that (x) unaudited financial
statements may not be in accordance with GAAP because of the absence of
footnotes normally contained therein, and (y) interim (unaudited) financials
are
subject to normal year-end audit adjustments that in the aggregate will not
have
a material adverse effect on Aura Sound, its business, financial condition
or
results of operations.
FINAL
(d) AuraSound’s
Financial Statements constitute all of the financial statements of AuraSound
required to be included in the Form 8-K due to be filed with the SEC by the
Company within four business days of the Closing Date.
2.7
Tax
Matters.
(a)
AuraSound
has incurred losses for the prior two years and has consequently not filed
all
federal, state, local and foreign tax returns required to be filed by, or with
respect to it, with the Internal Revenue Service or other applicable taxing
authority. No extensions with respect to such tax returns have been requested
or
granted.
(b)
Aura
Sound has paid, or adequately reserved against in Aura Sound’s Financial
Statements, all material taxes due, or claimed by any taxing authority to be
due, from or with respect to them.
(c)
To
the
best knowledge of Aura Sound, there has been no material issue raised or
material adjustment proposed (and none is pending) by the Internal Revenue
Service or any other taxing authority in connection with any of Aura Sound’s tax
returns.
(d)
No
waiver
or extension of any statute of limitations as to any material federal, state,
local or foreign tax matter has been given by or requested from Aura
Sound.
For
the
purposes of this Section
2.7,
a tax
is due (and must therefore either be paid or adequately reserved against in
Aura
Sound’s Financial Statements) only on the last date payment of such tax can be
made without interest or penalties, whether such payment is due in respect
of
estimated taxes, withholding taxes, required tax credits or any other
tax.
2.8
Books
and Records.
The
books and records of Aura Sound delivered to Hemcure prior to the Closing fully
and fairly reflect the transactions to which Aura Sound is a party or by which
its properties are bound.
2.9
Questionable
Payments.
Neither
Aura Sound, nor any employee, agent or representative of Aura Sound has,
directly or indirectly, made any bribes, kickbacks, illegal payments or illegal
political contributions using Company funds or made any payments from Aura
Sound's funds to governmental officials for improper purposes or made any
illegal payments from Aura Sound's funds to obtain or retain
business.
2.
10
Intellectual
Property.
Aura
Sound has no knowledge of any claim that, or inquiry as to whether, any product,
activity or operation of Aura Sound infringes upon or involves, or has resulted
in the infringement of, any trademarks, trade-names, service marks, patents,
copyrights or other proprietary rights of any other person, corporation or
other
entity; and no such proceedings have been instituted, are pending or are
threatened.
2.11
Litigation.
Aura
Sound is not subject to any judgment or order of any court or quasijudicial
or
administrative agency of any jurisdiction, domestic or foreign, nor is there
any
charge, complaint, lawsuit or governmental investigation pending against Aura
Sound. Aura Sound is not a plaintiff in any action, domestic or foreign,
judicial or administrative. There are no existing actions, suits, proceedings
against or investigations of Aura Sound, and Aura Sound knows of no basis for
such actions, suits, proceedings or investigations. There are no unsatisfied
judgments, orders, decrees or stipulations affecting Aura Sound or to which
Aura
Sound is a party.
FINAL
2.12
Legal
Compliance.
To the
best knowledge of Aura Sound, after due investigation, no claim has been filed
against Aura Sound alleging a violation of any applicable laws or regulations
of
foreign, federal, state and local governments and all agencies thereof. Aura
Sound holds all of the material permits, licenses, certificates or other
authorizations of foreign, federal, state or local governmental agencies
required for the conduct of its business as presently conducted; provided,
however, Hemcure expressly acknowledges that there are pending petitions with
the U.S. Patent and Trademark Office to revive seven of Aura Sound’s patents,
which lapsed due to an inadvertent failure to pay the required maintenance
fees,
and that those seven patents are not considered invalid or unenforceable for
the
pendency of those petitions.
2.13
Disclosure.
The
representations and warranties and statements of fact made by Aura Sound in
this
Agreement are, as applicable, accurate, correct and complete 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 and information contained herein
not
false or misleading.
ARTICLE
3
REPRESENTATIONS
AND WARRANTIES
OF
THE AURA SOUND SHAREHOLDERS
The
Aura
Sound Shareholders hereby represent and warrant to Hemcure as
follows:
3.1 Ownership
of the Aura Sound Shares.
Each
Aura Sound Shareholder owns, beneficially and of record, good and marketable
title to the Aura Sound Shares set forth opposite such Aura Sound Shareholder’s
name in Column I on Schedule I attached hereto, free and clear of all security
interests, liens, adverse claims, encumbrances, equities, proxies, options
or
stockholders' agreements. Each Aura Sound Shareholder represents that such
person has no right or claims whatsoever to any shares of Aura Sound capital
stock, other than shares listed opposite such Aura Sound Shareholder’s name in
Column I on Schedule I and does not have any options, warrants or any other
instruments entitling such Aura Sound Shareholder to exercise to purchase or
convert into shares of Aura Sound capital stock. At the Closing, the Aura Sound
Shareholders will convey to Hemcure good and marketable title to the Aura Sound
Shares, free and clear of any security interests, liens, adverse claims,
encumbrances, equities, proxies, options, stockholders' agreements or
restrictions.
3.2
Authority
Relative to this Agreement.
This
Agreement has been duly and validly executed and delivered by each Aura Sound
Shareholder and constitutes a valid and binding agreement of each Aura Sound
Shareholder, enforceable against each Aura Sound Shareholder in accordance
with
its terms, except as such enforcement may be limited by bankruptcy, insolvency
or other similar laws affecting the enforcement of creditors' rights generally
or by general principles of equity.
3.3 Restricted
Securities.
Each
Aura Sound Shareholder acknowledges that the Hemcure Shares will not be
registered pursuant to the Securities Act of 1933, as amended (the "Securities
Act")
or any
applicable state securities laws, that the Hemcure Shares will be characterized
as "restricted securities" under federal securities laws, and that under such
laws and applicable regulations the Hemcure Shares cannot be sold or otherwise
disposed of without registration under the Securities Act or an exemption
therefrom. In this regard, each Aura Sound Shareholder is familiar with Rule
144
promulgated under the Securities Act, as currently in effect, and understands
the resale limitations imposed thereby and by the Securities Act.
FINAL
3.4 Accredited
Investor.
Each
Aura Sound Shareholder is an “Accredited Investor” as that term is defined in
rule 501 of Regulation D promulgated under the Securities Act. Each Aura Sound
Shareholder is able to bear the economic risk of acquiring the Hemcure Shares
pursuant to the terms of this Agreement, including a complete loss of such
Aura
Sound Shareholder’s investment in the Hemcure Shares.
3.5 Legend.
Each
Aura Sound Shareholder acknowledges that the certificate(s) representing such
Aura Sound Shareholder’s pro rata portion of the Hemcure Shares shall each
conspicuously set forth on the face or back thereof a legend in substantially
the following form:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID
ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
ARTICLE
4
REPRESENTATIONS
AND WARRANTIES OF
HEMCURE,
SBC AND XXXXXXX
Hemcure,
SBC and Xxxxxxx hereby represent and warrant, jointly and severally, to Aura
Sound and the Aura Sound Shareholders as follows:
4.1
Organization.
Hemcure
is a corporation duly organized, validly existing and in good standing under
the
laws of the state of its incorporation, and has the requisite corporate power
to
carry on its business as now conducted.
4.2
Capitalization.
Hemcure's authorized capital stock consists of (i) 100,000,000 shares of common
stock, of which 2,000,000 shares are issued and outstanding, and (ii) 20,000,000
shares of preferred stock, none of which are issued and outstanding. At the
Closing, Hemcure shall have no more than 25,505,305 issued and outstanding
shares of common stock (including all shares of common stock sold in the private
placement described in Section 7.1(c) of this Agreement). All issued and
outstanding shares of Hemcure capital stock are duly authorized, validly issued,
fully paid, non-assessable and free of preemptive rights. When issued, the
Hemcure Shares will be duly authorized, validly issued, fully paid,
non-assessable and free of preemptive rights. There are no outstanding or
authorized options, rights, warrants, calls, convertible securities, rights
to
subscribe, conversion rights or other agreements or commitments to which Hemcure
is a party or which are binding upon Hemcure providing for the issuance by
Hemcure or transfer by Hemcure of additional shares of Hemcure's capital stock
and Hemcure has not reserved any shares of its capital stock for issuance,
nor
are there any outstanding stock option rights, phantom equity or similar rights,
contracts, arrangements or commitments to issue capital stock of Hemcure. To
Hemcure’s, SBC’s and Xxxxxxx’x knowledge, there are no voting trusts or any
other agreements or understandings with respect to the voting of Hemcure's
capital stock. There are no obligations of Hemcure to repurchase, redeem or
otherwise re-acquire any shares of its capital stock as of the Closing. Other
than (a) the shares of Hemcure common stock to be registered pursuant to the
PPM
(as defined in Section 7.1(c) hereof), (b) 1,229,476 shares of common stock
held
by Next Stage Investments, LLC, (c) 619,329 shares held by SBC, (d) 3,200,000
shares of common stock underlying warrants issued to certain bridge lenders
of
Aura Sound, and (e) 245,000 shares of common stock underlying warrants to be
issued at the Closing to GP Group, LLC as part of its bridge loan arrangement
fee, Hemcure does not have any outstanding obligations to register any of its
shares of capital stock with the Securities and Exchange Commission.
FINAL
4.3
Certain
Corporate Matters.
Hemcure
is duly licensed or qualified to do business and is in good standing as a
foreign corporation in every jurisdiction in which the character of Hemcure's
properties or nature of Hemcure's business requires it to be so licensed or
qualified other than such jurisdictions in which the failure to be so licensed
or qualified does not, or insofar as can reasonably be foreseen, in the future
will not, have a material adverse effect on its financial condition, results
of
operations or business. Hemcure has full corporate power and authority and
all
authorizations, licenses and permits necessary to carry on the business in
which
it is engaged or in which it proposes presently to engage and to own and use
the
properties owned and used by it. Hemcure has delivered to Aura Sound true,
accurate and complete copies of its certificate or articles of incorporation
and
bylaws, which reflect all restatements of and amendments made thereto at any
time prior to the date of this Agreement. The records of meetings of the
stockholders and board of directors of Hemcure are complete and correct in
all
material respects. The stock records and stockholder list of Hemcure that
Hemcure has previously furnished to Aura Sound are complete and correct in
all
material respects and accurately reflect the record ownership and the beneficial
ownership of all the outstanding shares of Hemcure's capital stock and any
other
outstanding securities issued by Hemcure. Hemcure is not in default under or
in
violation of any provision of its certificate or articles of incorporation
or
bylaws in any material respect. Hemcure is not in any material default or in
violation of any restriction, lien, encumbrance, indenture, contract, lease,
sublease, loan agreement, note or other obligation or liability by which it
is
bound or to which any of its assets is subject.
4.4
Authority
Relative to this Agreement.
Each of
Hemcure, SBC and Xxxxxxx has the requisite power and authority to enter into
this Agreement and carry out its or his obligations hereunder. The execution,
delivery and performance of this Agreement by Hemcure and the consummation
of
the transactions contemplated hereby have been duly authorized by the board
of
directors of Hemcure and no other actions on the part of Hemcure are necessary
to authorize this Agreement or the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by Hemcure, SBC
and
Xxxxxxx and constitutes a valid and binding obligation of Hemcure, SBC and
Xxxxxxx, enforceable in accordance with its terms, except as such enforcement
may be limited by bankruptcy, insolvency or other similar laws affecting the
enforcement of creditors' rights generally or by general principles of
equity.
4.5
Consents
and Approvals; No Violations.
Except
for applicable requirements of federal securities laws and state securities
or
blue-sky laws, no filing with, and no permit, authorization, consent or approval
of, any third party, public body or authority is necessary for the consummation
by Hemcure of the transactions contemplated by this Agreement. Neither the
execution and delivery of this Agreement by Hemcure nor the consummation by
Hemcure of the transactions contemplated hereby, nor compliance by Hemcure
with
any of the provisions hereof, will (a) conflict with or result in any breach
of
any provisions of the charter or bylaws of Hemcure, (b) result in a violation
or
breach of, or constitute (with or without due notice or lapse of time or both)
a
default (or give rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, agreement or other instrument or obligation to
which Hemcure (as hereinafter defined) is a party or by which they or any of
their respective properties or assets may be bound or (c) violate any order,
writ, injunction, decree, statute, rule or regulation applicable to Hemcure,
or
any of their respective properties or assets, except in the case of clauses
(b)
and (c) for violations, breaches or defaults which are not in the aggregate
material to Hemcure taken as a whole.
FINAL
4.6 SEC
Documents.
Hemcure
hereby makes reference to the following documents filed with the United States
Securities and Exchange Commission (the “SEC”),
as
posted on the SEC’s website, xxx.xxx.xxx:
(collectively, the “SEC
Documents”):
(a)
Annual Report on Form 10-KSB for the fiscal years ended June 30, 2006 and 2004;
(b) Form 10-SB12G/A filed with the SEC on October 17, 2005, and (c) Quarterly
Reports on Form 10-QSB for the periods ended September 30, December 31 and
March
31, 2005 and 2004; and (c) Quarterly Reports on Form 10-QSB for the periods
ended September 30 and December 31, 2006; and any amendments thereto. The SEC
Documents constitute all of the documents and reports that Hemcure was required
to file with the SEC pursuant to the Securities Exchange Act of 1934
(“Exchange
Act”)
and
the rules and regulations promulgated thereunder by the SEC since June 30,
2004.
As of their respective dates, the SEC Documents complied in all material
respects with the requirements of the Securities Act and/or the Exchange Act,
as
the case may require, and the rules and regulations promulgated thereunder
and
none of the SEC Documents contained an untrue statement of a material fact
or
omitted to state a material fact required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading. The financial statements of Hemcure included in the 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 generally accepted accounting
principles in the United States (“GAAP”)
(except, in the case of unaudited statements, as permitted by the applicable
form under the Securities Act or the Exchange Act) 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 Hemcure as of the dates thereof
and
its consolidated statements of operations, stockholders’ equity and cash flows
for the periods then ended (subject, in the case of unaudited statements, to
normal and recurring year-end audit adjustments which were and are not expected
to have a material adverse effect on Hemcure, its business, financial condition
or results of operations). Except as and to the extent set forth on the balance
sheet of Hemcure as of December 31, 2006, including the notes thereto, Hemcure
has no liability or obligation of any nature (whether accrued, absolute,
contingent or otherwise and whether required to be reflected on a balance sheet
or not).
4.7 Financial
Statements.
(a) Included
in the SEC Documents are the audited balance sheets of Hemcure as at June 30,
2006, 2005 and 2004, and the related statements of operations, stockholders’
equity and cash flows for the three years then ended, together with the
unqualified report thereon (except with respect to continuation as a going
concern) of Xxxxxxxxxx & Associates (“Xxxxxxxxxx”),
independent auditors (collectively, “Hemcure’s
Audited Financials”).
(b) Included
in the SEC Documents are the unaudited balance sheet of Hemcure as at March
31,
2007, and the related statements of operations, stockholders’ equity and cash
flows for the nine months then ended, as reviewed by Xxxxxxxxxx (“Hemcure’s
Interim Financials”).
(c) Hemcure’s
Audited Financials and Hemcure’s Interim Financials (collectively “Hemcure’s
Financial Statements”)
(i)
are in accordance with the books and records of Hemcure, (ii) are correct and
complete in all material respects, (iii) fairly present the financial position
and results of operations of Hemcure as of the dates indicated, and (iv) are
prepared in accordance with GAAP (except that (x) unaudited financial statements
may not be in accordance with GAAP because of the absence of footnotes normally
contained therein, and (y) interim (unaudited) financials are subject to normal
year-end audit adjustments that in the aggregate will not have a material
adverse effect on Hemcure , their respective businesses, financial condition
or
results of operations.
FINAL
4.8
Events
Subsequent to Financial Statements.
Since
June 30, 2006, there has not been:
(a) Any
sale,
lease, transfer, license or assignment of any assets, tangible or intangible,
of
Hemcure;
(b)
Any
damage, destruction or property loss, whether or not covered by insurance,
affecting adversely the properties or business of Hemcure;
(c)
Any
declaration or setting aside or payment of any dividend or distribution with
respect to the shares of capital stock of Hemcure or any redemption, purchase
or
other acquisition of any such shares;
(d)
Any
subjection to any lien on any of the assets, tangible or intangible, of
Hemcure;
(e)
Any
incurrence of indebtedness or liability or assumption of obligations by
Hemcure;
(f)
Any
waiver or release by Hemcure of any right of any material value;
(g)
Any
compensation or benefits paid to officers or directors of Hemcure;
(h)
Any
change made or authorized in the articles of incorporation or bylaws of Hemcure,
except for the change to the articles of incorporation and by-laws made incident
to re-domiciling from Minnesota to Nevada;
(i)
Any
loan
to or other transaction with any officer, director or stockholder of Hemcure
giving rise to any claim or right of Hemcure against any such person or of
such
person against Hemcure; or
(j)
Any
material adverse change in the condition (financial or otherwise) of the
respective properties, assets, liabilities or business of Hemcure.
4.9 Liabilities.
Except
as otherwise disclosed in Hemcure’s Financial Statements, Hemcure does not have
any liability or obligation whatsoever, either direct or indirect, matured
or
unmatured, accrued, absolute, contingent or otherwise. In addition, Hemcure,
SBC
and Xxxxxxx represent that upon Closing, Hemcure will not have any liability
or
obligation whatsoever, either direct or indirect, matured or unmatured, accrued,
absolute, contingent or otherwise.
FINAL
4.10
Tax
Matters.
(a)
Hemcure
has duly filed all federal, state, local and foreign tax returns required to
be
filed by or with respect to it with the Internal Revenue Service or other
applicable taxing authority, and no extensions with respect to such tax returns
have been requested or granted;
(b)
Hemcure
has paid, or adequately reserved against in Hemcure’s Financial Statements, all
material taxes due, or claimed by any taxing authority to be due, from or with
respect to them;
(c)
To
the
best knowledge of Hemcure, there has been no material issue raised or material
adjustment proposed (and none is pending) by the Internal Revenue Service or
any
other taxing authority in connection with any of Hemcure’s tax
returns;
(d)
No
waiver
or extension of any statute of limitations as to any material federal, state,
local or foreign tax matter has been given by or requested from Hemcure;
and
For
the
purposes of this Section
4.10,
a tax
is due (and must therefore either be paid or adequately reserved against in
Hemcure’s Financial Statements) only on the last date payment of such tax can be
made without interest or penalties, whether such payment is due in respect
of
estimated taxes, withholding taxes, required tax credits or any other
tax.
4.11
Real
Property.
Hemcure
does not own or lease any real property.
4.12
Books
and Records.
The
books and records of Hemcure delivered to Aura Sound prior to the Closing fully
and fairly reflect the transactions to which Hemcure is a party or by which
its
properties are bound.
4.13
Questionable
Payments.
Neither
Hemcure, nor any employee, agent or representative of Hemcure has, directly
or
indirectly, made any bribes, kickbacks, illegal payments or illegal political
contributions using Company funds or made any payments from Hemcure's funds
to
governmental officials for improper purposes or made any illegal payments from
Hemcure's funds to obtain or retain business.
4.14
Intellectual
Property.
Hemcure
does not own or use any trademarks, trade names, service marks, patents,
copyrights or any applications with respect thereto. Hemcure, SBC and Xxxxxxx
have no knowledge of any claim that, or inquiry as to whether, any product,
activity or operation of Hemcure infringes upon or involves, or has resulted
in
the infringement of, any trademarks, trade-names, service marks, patents,
copyrights or other proprietary rights of any other person, corporation or
other
entity; and no such proceedings have been instituted, are pending or are
threatened against Hemcure.
4.15
Insurance.
Hemcure
does not have any insurance policies in effect.
4.16
Contracts.
Except
as set forth on Schedule
4.16,
Hemcure
does not have any material contracts, leases, arrangements or commitments
(whether oral or written). Hemcure is not a party to or bound by or affected
by
any contract, lease, arrangement or commitment (whether oral or written)
relating to: (a) the employment of any person; (b) collective bargaining with,
or any representation of any employees by, any labor union or association;
(c)
the acquisition of services, supplies, equipment or other personal property;
(d)
the purchase or sale of real property; (e) distribution, agency or construction;
(f) lease of real or personal property as lessor or lessee or sublessor or
sublessee; (g) lending or advancing of funds; (h) borrowing of funds or receipt
of credit; (i) incurring any obligation or liability; or (j) the sale of
personal property.
FINAL
4.17
Litigation.
Hemcure
is not subject to any judgment or order of any court or quasijudicial or
administrative agency of any jurisdiction, domestic or foreign, nor is there
any
charge, complaint, lawsuit or governmental investigation pending against
Hemcure. Hemcure is not a plaintiff in any action, domestic or foreign, judicial
or administrative. There are no existing actions, suits, proceedings against
or
investigations of Hemcure, and Hemcure knows of no basis for such actions,
suits, proceedings or investigations. There are no unsatisfied judgments,
orders, decrees or stipulations affecting Hemcure or to which Hemcure is a
party.
4.18
Employees.
Hemcure
does not have any employees. Hemcure does not owe any compensation of any kind,
deferred or otherwise, to any current or previous employees. Hemcure does not
have a written or oral employment agreement with any officer or director of
Hemcure. Hemcure is not a party to or bound by any collective bargaining
agreement. There are no loans or other obligations payable or owing by Hemcure
to any stockholder, officer, director or employee of Hemcure, nor are there
any
loans or debts payable or owing by any of such persons to Hemcure or any
guarantees by Hemcure of any loan or obligation of any nature to which any
such
person is a party.
4.19
Employee
Benefit Plans.
Hemcure
does not have any (a) non-qualified deferred or incentive compensation or
retirement plans or arrangements, (b) qualified retirement plans or
arrangements, (c) other employee compensation, severance or termination pay
or
welfare benefit plans, programs or arrangements or (d) any related trusts,
insurance contracts or other funding arrangements maintained, established or
contributed to by Hemcure.
4.20
Legal
Compliance.
To the
best knowledge of Hemcure, after due investigation, no claim has been filed
against Hemcure alleging a violation of any applicable laws or regulations
of
foreign, federal, state and local governments and all agencies thereof. Hemcure
holds all of the material permits, licenses, certificates or other
authorizations of foreign, federal, state or local governmental agencies
required for its business as presently conducted.
4.21 Subsidiaries
and Investments.
Hemcure
does not own any capital stock or have any interest of any kind whatsoever
in
any corporation, partnership, or other form of business
organization.
4.22
Broker's
Fees.
Neither
Hemcure, nor anyone on its behalf, has any liability to any broker, finder,
investment banker or agent, or has agreed to pay any brokerage fees, finder’s
fees or commissions, or to reimburse any expenses of any broker, finder,
investment banker or agent in connection with this Agreement.
4.23 Internal
Accounting Controls.
Hemcure
maintains a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
GAAP and to maintain asset accountability, (iii) access to assets is permitted
only in accordance with management’s general or specific authorization, and (iv)
the recorded accountability for assets is compared with the existing assets
at
reasonable intervals and appropriate action is taken with respect to any
differences.
Hemcure
has established disclosure controls and procedures (as defined in Exchange
Act
Rules 13a-15(e) and 15d-15(e)) for Hemcure and designed such disclosure controls
and procedures to ensure that material information relating to Hemcure is made
known to the certifying officers by others within those entities, particularly
during the period in which Hemcure's Form 10-KSB or 10-QSB, as the case may
be,
is being prepared. Hemcure's certifying officers have evaluated the
effectiveness of Hemcure's controls and procedures as of the end of the filing
period prior to the filing date of the Form 10-QSB for the quarter ended March
31, 2007 (such date, the "Evaluation
Date").
Hemcure presented in its most recently filed Form 10-KSB or Form 10-QSB the
conclusions of the certifying officers about the effectiveness of the disclosure
controls and procedures based on their evaluations as of the Evaluation Date.
Since the Evaluation Date, there have been no significant changes in Hemcure's
internal controls (as such term is defined in Item 307(b) of Regulation S-K
under the Exchange Act) or, to the Company's knowledge, in other factors that
could significantly affect the Company's internal controls.
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4.24 Listing
and Maintenance Requirements.
Hemcure’s common stock is currently quoted on the OTC Bulletin Board. Hemcure
has not, since October 1, 2005, received any notice from the OTC Bulletin Board
or the NASD or any trading market on which Hemcure’s common stock is or has been
listed or quoted to the effect that Hemcure is not in compliance with the
quoting, listing or maintenance requirements of the OTC Bulletin Board or such
other trading market. Hemcure is, and has no reason to believe that it will
not,
in the foreseeable future continue to be, in compliance with all such quoting,
listing and maintenance requirements.
4.25 Application
of Takeover Protections.
Hemcure
and its board of directors have 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 Hemcure's certificate or articles of incorporation
(or similar charter documents) or the laws of its state of incorporation that
is
or could become applicable to Aura Sound or the Aura Sound Shareholders as
a
result of the Exchange or the exercise of any rights by Aura Sound or the Aura
Sound Shareholders pursuant to this Agreement.
4.26 No
SEC
or NASD Inquiries.
Neither
Hemcure nor any of its past or present officers or directors is, or has ever
been, the subject of any formal or informal inquiry or investigation by the
SEC
or NASD.
4.27
Disclosure.
The
representations and warranties and statements of fact made by Hemcure in this
Agreement are, as applicable, accurate, correct and complete 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 and information contained herein
not
false or misleading.
ARTICLE
5
INDEMNIFICATION
5.1 SBC/Xxxxxxx
Indemnification.
For a
period of one year after the Closing, SBC and Xxxxxxx each agree, jointly and
severally, to indemnify Aura Sound, the Aura Sound Shareholders and each of
the
officers, agents and directors of Aura Sound or the Aura Sound Shareholders
against any loss, liability, claim, damage or expense (including, but not
limited to, any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever) (each an “Indemnified
Party”)
to
which it or they may become subject arising out of or based on either (i) any
breach of or inaccuracy in any of the representations and warranties or
covenants or conditions made by Hemcure, SBC or Xxxxxxx in this Agreement;
(ii)
any and all liabilities arising out of or in connection with any of the assets,
business or operations of Hemcure prior to the Closing, or (iii) any breach
of
or inaccuracy in any of the representations and warranties or covenants or
conditions made by Hemcure in the XXXX Loan Agreement or the Subscription
Agreement attached as an exhibit to the PPM, in any case only as such
representations, warranties, covenants or conditions apply to Hemcure prior
to
the Closing (collectively, the “Xxxxxxx
Indemnification”).
FINAL
5.2 Indemnification
Procedures.
If any
action shall be brought against an Indemnified Party in respect of which
indemnity may be sought pursuant to this Agreement, such Indemnified Party
shall
promptly notify Xxxxxxx and SBC in writing, and Xxxxxxx and SBC shall each
have
the right to assume the defense thereof with counsel of his or its own choosing.
Any Indemnified Party shall have the right to employ separate counsel in any
such action and participate in the defense thereof, but the fees and expenses
of
such counsel shall be at the expense of such Indemnified Party except to the
extent that the employment thereof has been specifically authorized by Xxxxxxx
or SBC in writing, SBC and Xxxxxxx have failed after a reasonable period of
time
to assume such defense and to employ counsel or in such action there is, in
the
reasonable opinion of such separate counsel, a material conflict on any material
issue between the position of SBC or Xxxxxxx and the position of such
Indemnified Party. Neither SBC nor Xxxxxxx will be liable to any Indemnified
Party under this Article 5 for any settlement by an Indemnified Party effected
without SBC or Xxxxxxx’x prior written consent, which shall not be unreasonably
withheld or delayed.
ARTICLE
6
COVENANTS
AND AGREEMENTS OF THE PARTIES
EFFECTIVE
PRIOR TO CLOSING
6.1
Corporate
Examinations and Investigations.
Prior
to the Closing, each party shall be entitled, through its employees and
representatives, to make such investigations and examinations of the books,
records and financial condition of Aura Sound and Hemcure as each party may
request. In order that each party may have the full opportunity to do so, Aura
Sound and Hemcure shall furnish each party and its representatives during such
period with all such information concerning the affairs of Aura Sound or Hemcure
as each party or its representatives may reasonably request and cause Aura
Sound
or Hemcure and their respective officers, employees, consultants, agents,
accountants and attorneys to cooperate fully with each party's representatives
in connection with such review and examination and to make full disclosure
of
all information and documents requested by each party or its representatives.
Any such investigations and examinations shall be conducted at reasonable times
and under reasonable circumstances, it being agreed that any examination of
original documents will be at each party's premises, with copies thereof to
be
provided to each party or its representatives upon request.
6.2 Cooperation;
Consents.
Prior
to the Closing, each party shall cooperate with the other parties to the end
that the parties shall (i) in a timely manner make all necessary filings with,
and conduct negotiations with, all authorities and other persons the consent
or
approval of which, or the license or permit from which is required for the
consummation of the Exchange and (ii) provide to each other party such
information as the other party may reasonably request in order to enable it
to
prepare such filings and to conduct such negotiations.
6.3 Conduct
of Business.
Subject
to the provisions hereof, from the date hereof through the Closing, each party
hereto shall (i) conduct its business in the ordinary course and in such a
manner so that the representations and warranties contained herein shall
continue to be true and correct in all material respects as of the Closing
as if
made at and as of the Closing and (ii) not enter into any material transactions
or incur any material liability not required or specifically contemplated
hereby, without first obtaining the written consent of Aura Sound and the Aura
Sound Shareholders on the one hand and Hemcure, SBC and Xxxxxxx on the other
hand. Without the prior written consent of Aura Sound, the Aura Sound
Shareholders, Hemcure, SBC or Xxxxxxx, except as required or specifically
contemplated hereby, each party shall not undertake or fail to undertake any
action if such action or failure would render any of said warranties and
representations untrue in any material respect as of the Closing.
FINAL
6.4 Litigation.
From
the date hereof through the Closing, each party hereto shall promptly notify
the
representative of the other parties of any lawsuits, claims, proceedings or
investigations which after the date hereof are threatened or commenced against
such party or any of its affiliates or any officer, director, employee,
consultant, agent or shareholder thereof, in their capacities as such, which,
if
decided adversely, could reasonably be expected to have a material adverse
effect upon the condition (financial or otherwise), assets, liabilities,
business, operations or prospects of such party or any of its
subsidiaries.
6.5 Notice
of Default.
From
the date hereof through the Closing, each party hereto shall give to the
representative of the other parties prompt written notice of the occurrence
or
existence of any event, condition or circumstance occurring which would
constitute a violation or breach of this Agreement by such party or which would
render inaccurate in any material respect any of such party's representations
or
warranties herein.
ARTICLE
7
CONDITIONS
TO CLOSING
7.1
Conditions
to Obligations of Aura Sound and the Aura Sound Shareholders.
The
obligations of Aura Sound and the Aura Sound Shareholders under this Agreement
shall be subject to each of the following conditions:
(a) Closing
Deliveries.
At the
Closing, Hemcure shall have delivered or caused to be delivered to Aura Sound
the following:
(i)
resolutions
duly adopted by the board of directors of Hemcure authorizing and approving
the
Exchange and the execution, delivery and performance of this
Agreement;
(ii)
a
certificate of good standing for Hemcure from its jurisdiction of incorporation,
dated not earlier than five days prior to the Closing Date;
(iii)
written
resignations of all officers and directors of Hemcure in office immediately
prior to the Closing, and board resolutions electing the following individuals
to the positions with Hemcure listed opposite their names
below:
|
Xxxxxx
Xxx
|
Chairman
of the Board, Chief Executive Officer and
|
||
|
Chief
Financial Officer
|
|||
|
Xxxxxx
North
|
Vice
President Engineering
|
||
|
Xxx
Xxx
|
Director
|
||
|
Xxxxx
Xxxxx
|
Secretary,
Director
|
||
|
Xxxxxx
Xxxxxxx
|
Director
|
(iv)
this
Agreement duly executed by Hemcure, SBC and Xxxxxxx;
FINAL
(v) all
corporate records, agreements, seals and any other information reasonably
requested by Aura Sound’s representatives with respect to Hemcure;
and
(vi) such
other documents as Aura Sound or the Aura Sound Shareholders may reasonably
request in connection with the transactions contemplated hereby.
(b) Representations
and Warranties to be True.
The
representations and warranties of Hemcure, SBC and Xxxxxxx herein contained
shall be true in all material respects at the Closing with the same effect
as
though made at such time. Hemcure, SBC and Xxxxxxx shall have performed in
all
material respects all obligations and complied in all material respects with
all
covenants and conditions required by this Agreement to be performed or complied
with by them at or prior to the Closing.
(c) Private
Placement.
On or
before the Closing Date, Hemcure and AuraSound shall have in an escrow account
for their collective benefit no less than $10,000,000 in gross proceeds pursuant
to the Amended and Restated Confidential Private Placement Memorandum, dated
June 7, 2007, in connection with the reverse merger of Hemcure and Aura Sound
(the “PPM”),
and
such funds shall be released from escrow at the Closing.
(d) SEC
Filings.
At the
Closing, Hemcure will be current in all SEC filings required by it to be
filed.
(e) OTCBB
Trading.
Hemcure’s common stock shall be quoted and eligible for trading on the OTC
Bulletin Board.
(f) Warrants.
At the
Closing, Hemcure shall issue the following warrants:
(i)
GP
Group,
LLC will receive a five year warrant to purchase 245,000 shares of common stock
as part of a bridge loan placement fee. The warrants will have an exercise
price
of $0.80/share.
(ii) Mapleridge
Investment Services, a bridge lender of AuraSound, will receive a five-year
warrant to purchase 750,000 shares of Hemcure common stock at an exercise price
of $1.00 per share.
(iii) Westrec
Properties, Inc. and Affiliated Companies 401(k) Plan, a bridge lender of
AuraSound, will receive a five-year warrant to purchase 750,000 shares of
Hemcure common stock at an exercise price of $1.00/share.
(iv) Apex
Investment Fund, Ltd.,
a
bridge lender of AuraSound, will receive a five-year warrant to purchase 750,000
shares of common stock at an exercise price of $1.00/share.
(v) Clearview
Partners, LLC, a bridge lender of AuraSound, will receive a five-year warrant
to
purchase 750,000 of common stock at an exercise price of $1.00 per
share.
FINAL
(vi) YKA
Partners Ltd., a bridge lender of AuraSound, will receive a five-year warrant
to
purchase 200,000 shares of common stock at an exercise price of
$1.00/share.
All
of
the foregoing warrants will be issued in form and substance reasonably
acceptable to AuraSound and as required by the applicable transaction documents
requiring the issuance of such warrants.
7.2 Conditions
to Obligations of Hemcure, SBC and Xxxxxxx.
The
obligations of Hemcure, SBC and Xxxxxxx under this Agreement shall be subject
to
each of the following conditions:
(a) Closing
Deliveries.
On the
Closing Date, Aura Sound or the Aura Sound Shareholders shall have delivered
to
Hemcure the following:
(i) certificates
representing the Aura Sound Shares, duly endorsed in blank or each accompanied
by a stock power effecting the transfer thereof to Hemcure;
(ii)
this
Agreement duly executed by Aura Sound and the Aura Sound
Shareholders;
(iii) such
other documents as Hemcure may reasonably request in connection with the
transactions contemplated hereby.
(b) Representations
and Warranties to be True.
The
representations and warranties of Aura Sound and the Aura Sound Shareholders
herein contained shall be true in all material respects at the Closing with
the
same effect as though made at such time. Aura Sound and the Aura Sound
Shareholders shall have performed in all material respects all obligations
and
complied in all material respects with all covenants and conditions required
by
this Agreement to be performed or complied with by them at or prior to the
Closing.
ARTICLE
8
TERMINATION
8.1 Events
of
Termination. This Agreement may, by notice given in the manner hereinafter
provided, be terminated and abandoned at any time prior to completion of the
Closing, as follows:
(a) by
Aura
Sound if (1) there has been a material Breach by Hemcure and, in the case of
a
covenant or agreement Breach, such Breach shall not have been cured within
ten
(10) days after receipt by Hemcure of notice specifying particularly such
Breach, (2) if Aura Sound identifies hereafter any fact, circumstance or event
that could be reasonably determined to have a material adverse effect on Hemcure
and such fact, circumstance or event is not cured by Hemcure within ten (10)
days after receipt by Hemcure of notice specifying particularly such fact,
event
or circumstance, or (3) if the closing conditions set forth in Article 7 have
not been satisfied by the close of business on June 30, 2007;
(b) by
Hemcure (1) if there has been a material Breach by Aura Sound and, in the case
of a covenant or agreement Breach, such Breach shall not have been cured within
ten (10) days after receipt by Aura Sound of notice specifying particularly
such
Breach, or (2) if Hemcure identifies hereafter any fact, circumstance or event
that could be reasonably determined to have a material adverse effect on Aura
Sound, or Hemcure following the Merger, and such fact, circumstance or event
is
not cured by Aura Sound within ten (10) days after receipt by Aura Sound of
notice specifying particularly such fact, event or circumstance, or (3) if
the
closing conditions set forth in Article 7 have not been satisfied by the close
of business on June 30, 2007; or
FINAL
(c) at
any
time by mutual written agreement of Aura Sound and Hemcure.
This
Agreement may not be terminated after completion of the Closing, except by
mutual agreement of Aura Sound and Hemcure.
For
the
purposes of this Article 8, there shall be deemed to be a “Breach”
of
a
representation, warranty, covenant, obligation, or other provision if there
is
or has been (a) any inaccuracy (subject to applicable knowledge and
materiality qualifiers, if any) in, or breach of, or any failure to comply
with,
or perform, such representation, warranty, covenant, obligation, or other
provision, or (b) any claim (by any person) or other circumstance that is
inconsistent with such representation, warranty, covenant, obligation, or other
provision; and the term “Breach” shall be deemed to refer to any such
inaccuracy, breach, failure, claim, or circumstance.
ARTICLE
9
GENERAL
PROVISIONS
9.1
Notices.
All
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if delivered personally, sent by overnight
courier or mailed by registered or certified mail (postage prepaid and return
receipt requested) to the party to whom the same is so delivered, sent or mailed
at the addresses set forth on the signature page hereof (or at such other
address for a party as shall be specified by like notice).
9.2
Interpretation.
The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
References to Sections and Articles refer to sections and articles of this
Agreement unless otherwise stated.
9.3
Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction to be invalid, void or unenforceable, the remainder
of
the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated and the parties shall negotiate in good faith to modify this
Agreement to preserve each party's anticipated benefits under this
Agreement.
9.4
Miscellaneous.
This
Agreement (together with all schedules, documents and instruments referred
to
herein): (a) constitutes the entire agreement and supersedes all other prior
agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof; (b) except as expressly set forth herein,
is not intended to confer upon any other person any rights or remedies hereunder
and (c) shall not be assigned by operation of law or otherwise, except as may
be
mutually agreed upon by the parties hereto.
9.5 Separate
Counsel.
Each
party hereby expressly acknowledges that it has been advised to seek its own
separate legal counsel for advice with respect to this Agreement, and that
no
counsel to any party hereto has acted or is acting as counsel to any other
party
hereto in connection with this Agreement.
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9.6
Governing
Law; Venue.
This
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of California. Any and all actions brought under this
Agreement shall be brought in the state or federal courts of the United States
sitting in the City of Los Angeles, California and each party hereby waives
any
right to object to the convenience of such venue.
9.7
Counterparts
and Facsimile Signatures.
This
Agreement may be executed in two or more counterparts, which together shall
constitute a single agreement. This Agreement and any documents relating to
it
may be executed and transmitted to any other party by facsimile, which facsimile
shall be deemed to be, and utilized in all respects as, an original, wet-inked
document.
9.8 Amendment.
This
Agreement may be amended, modified or supplemented only by an instrument in
writing executed by Hemcure, Aura Sound and the holders of at least 75% of
the
Aura Sound Shares.
9.9 Parties
In Interest: No Third Party Beneficiaries.
Except
as otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto. This Agreement
shall not be deemed to confer upon any person not a party hereto any rights
or
remedies hereunder.
9.10 Waiver.
No
waiver by any party of any default or breach by another party of any
representation, warranty, covenant or condition contained in this Agreement
shall be deemed to be a waiver of any subsequent default or breach by such
party
of the same or any other representation, warranty, covenant or condition. No
act, delay, omission or course of dealing on the part of any party in exercising
any right, power or remedy under this Agreement or at law or in equity shall
operate as a waiver thereof or otherwise prejudice any of such party's rights,
powers and remedies. All remedies, whether at law or in equity, shall be
cumulative and the election of any one or more shall not constitute a waiver
of
the right to pursue other available remedies.
9.11 Expenses.
At or
prior to the Closing, the parties hereto shall pay all of their own expenses
relating to the transactions contemplated by this Agreement, including, without
limitation, the fees and expenses of their respective counsel and financial
advisers.
9.12 Recitals
Incorporated.
The
recitals of this Agreement are incorporated herein and made a part
hereof.
[SIGNATURES
FOLLOW]
FINAL
IN
WITNESS WHEREOF,
the
parties have executed this Agreement as of the date first written
above.
|
Aura
Sound, Inc.,
a
California corporation
|
||
| |
|
|
| By: | ||
|
Name:
Xxxxxx Xxx
Title:
Chief Executive Officer
|
||
Address:
00000
Xxxx Xxxxx Xxxxxx
Xxxxx
Xx
Xxxxxxx, XX 00000
With
a
copy to (which shall not constitute notice):
Xxxxxxxxxx
& Xxxxx, LLP
The
Chrysler Building
000
Xxxxxxxxx Xxxxxx
00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxx Xxxxxxxxx, Esq.
[SIGNATURE
OF 75% AURA SOUND SHAREHOLDER]
| Name |
Signature
|
Address |
|
Xxxxxx
Xxx
|
[SIGNATURE
PAGE OF HEMCURE, SBC AND XXXXXXX FOLLOW]
FINAL
[SIGNATURE
PAGE OF HEMCURE, SBC AND XXXXXXX]
|
Hemcure,
Inc., a Nevada corporation
|
||
| |
|
|
| By: | ||
|
Name: Xxxxxx X. Xxxxxxx |
||
| Title: Chief Executive Officer | ||
| Synergy Business Consulting, LLC | ||
| |
|
|
| By: | ||
|
Xxxxxxx
X. Xxxxxxx
|
||
| Its: Managing Member | ||
|
Xxxxxx X. Xxxxxxx, an
individual
|
||
FINAL
SCHEDULE
I
|
Name
|
Column
I
Number
of Shares of Aura Sound
|
Column
II
Number
of Shares of Hemcure
|
|||||
|
Xxxxxx
Xxx
|
10,603,304
|
10,603,304
|
|||||
|
Haztlacha
Investment
|
406,596
|
406,596
|
|||||
|
Xxxxxx
Xxxxxxx
|
225,886
|
225,886
|
|||||
|
Xxxxxxx
Xxxxxxx
|
151,489
|
151,489
|
|||||
|
Gimilis
Chesed Xxxxx Xxxxx B’Xxx Xxxx Association
|
118,030
|
118,030
|
|||||
|
Total
|
11,505,305
|
11,505,305
|
|||||
FINAL
SCHEDULE
4.16
Hemcure,
Inc. engages services from the following providers: ComputerShare (transfer
agent); Synergy Law Group, LLC (legal); Vintage Filings (XXXXX filing services);
and Xxxxxxxxxx & Associates, Inc. (accounting services).
FINAL
EXHIBIT
A
Form
of
Articles of Exchange (Nevada)
