Exhibit 10.1

 

EXECUTION COPY

 

SHARE EXCHANGE AGREEMENT

 

THIS SHARE EXCHANGE AGREEMENT (“Agreement”) is made and entered into this _14_
day of September, 2016 (the “Agreement Date”), by and between Ominto, Inc.
(“Ominto”); and Quant Systems, Inc. (“Quant”). Ominto and Quant are sometimes
referred to individually as a “Party” and collectively as the “Parties”.

 

RECITALS

 

WHEREAS, Quant desires to acquire one million four hundred twenty-eight thousand
five hundred seventy-one (1,428,571) shares of Ominto’s common stock (the
“Ominto Shares”) in exchange for the Consideration, as defined below; and

 

WHEREAS, Ominto desires to sell Ominto Shares to Quant in accordance with the
terms set forth in this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the promises and mutual covenants set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:

 

1. PURCHASE AND TRANSFER OF SHARES

 

1.1 Sale of Ominto Shares. Upon the receipt by Ominto of the Consideration on
the Closing Date, as defined below, Ominto hereby sells, grants, and assigns to
Quant, and Quant purchases and accepts from Ominto, free and clear of all
Encumbrances, as defined below, and subject to the terms of this Agreement, all
of Ominto’s right, title and interest in and to Ominto Shares.

 

1.2 For purposes of this Agreement, “Encumbrance” means any lien, pledge,
hypothecation, charge, security interest, encumbrance, equity, trust, equitable
interest, claim, preference, right of possession, lease, license, encroachment,
covenant, infringement, interference, order, proxy, option, right of first
refusal, preemptive right, community property interest, legend, defect,
impediment, exception, reservation, limitation, impairment, imperfection of
title, condition, or restriction of any nature.

 

1.3 The “Closing Date” shall be the date mutually agreed to by the Parties that
is not earlier than five business days after the Closing Conditions set forth in
Section 6 are satisfied. On the Closing Date, the Consideration shall be
delivered to Ominto and Ominto Shares shall be transferred to Quant.

 

2. CONSIDERATION

 

2.1 Consideration. In consideration of the sale and assignment by Ominto of
Ominto Shares, Quant hereby agrees to issue and/or transfer to Ominto on the
Closing Date, free and clear of all Encumbrances, all right, title, and interest
in and to shares of Quant’s common stock (the “Quant Shares” or the
“Consideration”) with an aggregate value of five million dollars ($5,000,000)
which will represent 19.5% of the issued and outstanding common stock of Quant
based on the agreed-upon valuation of Quant at $25.64 million.

 

 -1- 

 

 

EXECUTION COPY

 

3. REPRESENTATIONS AND WARRANTIES OF OMINTO

 

Ominto hereby makes the following representations and warranties to Quant as of
the Agreement Date and the Closing Date (other than representations and
warranties that are made as of a specific date, which representations and
warranties shall have been true and correct as of such date), which
representations and warranties are made for the express purpose of inducing
Quant to enter into this Agreement and consummate the transactions contemplated
hereby.

 

3.1 Organization, Good Standing and Authority. Ominto is a corporation duly
organized, validly existing, and in good standing under the laws of Nevada, and
has authority to enter into this Agreement and perform its obligations
hereunder. This Agreement constitutes a valid and binding agreement of Ominto
enforceable in accordance with its terms. Neither the execution and delivery of
this Agreement nor the consummation by Ominto of the transactions contemplated
hereby, nor compliance by Ominto with any of the provisions hereof, will (i)
constitute a violation of or default under, any contract, instrument,
commitment, agreement, understanding, arrangement, or restriction of any kind to
which Ominto is a party, or by which Ominto or the Ominto Shares may be bound,
or (ii) violate any rule, regulation, law, statute, ordinance, judgment, order,
writ, injunction, or decree of any court, administrative agency, or governmental
body applicable to Ominto or the Ominto Shares.

 

3.2 No Broker. Ominto represents that it has not engaged any broker or finder in
connection with this transaction. Ominto will indemnify and hold harmless Quant
for any cost or expense including, but not limited to, court costs and
reasonable attorneys’ fees incurred by Quant as a result of a claim by any
broker or finder based upon dealings by Ominto with such broker or finder.

 

3.3 Disclosure. No representation or warranty made by Ominto in this Agreement
or in any document furnished in connection herewith contains any untrue
statement of a material fact or omits to state any material fact necessary to
make the statements herein or therein not misleading.

 

3.4 Capitalization. The authorized capital stock of Ominto consists of
14,000,000 shares of common stock, of which 12,233,472 shares are validly issued
and outstanding. All of such issued and outstanding shares were validly issued
in compliance with applicable law, are fully paid and non assessable. There is
no existing option, warrant, call, commitment or other agreement to which Ominto
is a party requiring, and there are no convertible securities of Ominto
outstanding which upon conversion would require, the issuance of any additional
shares of capital stock of Ominto or other securities convertible into shares of
capital stock of Ominto.

 

3.5 Financial Statements. During the period commencing on the date of the
most-recently filed financial statements and ending on the Closing Date, (a)
there have been no material adverse changes in Ominto’s financial statements or
in the financial condition or prospects of Ominto; and (b) Ominto has conducted
its business in the ordinary course of business consistent with past practices.

 

 -2- 

 

 

EXECUTION COPY

 

3.6 Taxes. Ominto has timely and appropriately filed all tax returns as required
to be filed. All tax returns filed by Ominto are true, correct and complete in
all respects. All taxes owed (or required to be remitted) by Ominto (whether or
not shown or required to be shown on any tax return) have been timely paid. No
claim has been made by any governmental body in a jurisdiction where Ominto does
not file tax returns that Ominto is or may be subject to the payment, collection
or remittance of any tax of that jurisdiction or is otherwise subject to
taxation by that jurisdiction. There are no Encumbrances of any kind on any of
the assets of Ominto in connection with, or otherwise related to, any failure
(or alleged failure) to pay any tax.

 

3.7 Litigation; No Violation. There is no legal or administrative proceeding
pending, threatened or anticipated against Ominto. Ominto has no knowledge of
any event that has occurred or circumstance that exists that would reasonably be
expected to give rise to or serve as a basis for the commencement of any legal
or administrative proceeding. Ominto is not in violation of any applicable laws
including, without limitation, labor, employment, and environmental laws, or in
breach or default of any agreement, document, judgment, injunction, order or
decree binding upon Ominto which could reasonably be expected to result in a
material adverse effect on Ominto.

 

4. REPRESENTATIONS AND WARRANTIES OF QUANT

 

Quant hereby makes the following representations and warranties to Ominto as of
the Agreement Date and the Closing Date (other than representations and
warranties that are made as of a specific date, which representations and
warranties shall have been true and correct as of such date), which
representations and warranties are made for the express purpose of inducing
Ominto to enter into this Agreement and consummate the transactions contemplated
hereby.

 

4.1 Organization, Good Standing, and Authority. Quant is a corporation duly
organized, validly existing, and in good standing under the laws of Texas and
has authority to enter into this Agreement and perform its obligations
hereunder. This Agreement constitutes a valid and binding agreement of Quant
enforceable in accordance with its terms.

 

4.2 No Breach. The execution and delivery of this Agreement by Quant on the
Closing Date is not an event which, of itself or with the giving of notice or
the passage of time, or both, could constitute a violation of or conflict with
or result in any breach of, or default under the terms, conditions, or
provisions of any judgment, law, or regulation, or Quant’s charter documents, or
any agreement or instrument to which Quant is a party or by which it is bound.

 

4.3 No Broker. Quant represents that it has not engaged any broker or finder in
connection with this transaction. Quant will indemnify and hold harmless Ominto
for any cost or expense including, but not limited to, court costs and
reasonable attorneys’ fees incurred by Ominto as a result of a claim by any
broker or finder based upon dealings by Quant with such broker or finder.

 

 -3- 

 

 

EXECUTION COPY

 

4.4 Disclosure. No representation or warranty made by Quant in this Agreement or
in any document furnished in connection herewith contains any untrue statement
of a material fact or omits to state any material fact necessary to make the
statements herein or therein not misleading.

 

4.5 Capitalization. The authorized capital stock of Quant consists of 10,000,000
shares of common stock, of which one hundred (100) shares are validly issued and
outstanding. All of such issued and outstanding shares were validly issued in
compliance with applicable law, are fully paid and non assessable. There is no
existing option, warrant, call, commitment or other agreement to which Quant is
a party requiring, and there are no convertible securities of Quant outstanding
which upon conversion would require, the issuance of any additional shares of
capital stock of Quant or other securities convertible into shares of capital
stock of Quant.

 

4.6 Title to Shares. (ii) Quant, on the Closing Date, shall have (A) good and
valid title to the Quant Shares, free and clear of all Encumbrances, and (B) the
right to sell, assign, and transfer the Quant Shares (with all voting rights) to
Ominto, free and clear of any restrictions on such transfer.

 

4.7 Financial Statements. Quant has delivered to Ominto true and correct copies
of the most-recently prepared balance sheet and income statement of Quant and
(ii) compiled financial statements of Quant for the prior three fiscal years
(collectively, the “Financial Statements”). The Financial Statements have been
prepared in accordance with GAAP, applied on a consistent basis throughout the
periods covered thereby, and present fairly the financial condition of Quant as
of and for their respective dates. Quant does not have any liabilities which are
not reflected on the Financial Statements. Quant’s books and records (including
all financial records, business records, customer lists, and records pertaining
to products or services delivered to customers) (i) are complete and correct in
all material respects and all transactions to which Quant is or has been a party
are accurately reflected therein in all material respects, (ii) reflect all
discounts, returns and allowances granted by Quant with respect to the periods
covered thereby, (iii) form the basis for the Financial Statements and (iv)
reflect in all material respects the assets, liabilities, financial position,
and results of operations of Quant. All computer-generated reports and other
computer output included in such Quant’s books and records are complete and
correct in all material respects and were prepared in accordance with sound
business practices based upon authentic data. Quant’s management information
systems are adequate for the preservation of relevant information and the
preparation of accurate reports. During the period commencing on the date of the
most-recent Financial Statement and ending on the Closing Date, (a) there have
been no material adverse changes in the Financial Statements or in the financial
condition or prospects of Quant; and (b) Quant has conducted its business in the
ordinary course of business consistent with past practices.

  

 -4- 

 

 

EXECUTION COPY

 

4.8 Taxes. Quant has timely and appropriately filed all tax returns as required
to be filed. All tax returns filed by Quant are true, correct and complete in
all respects. All taxes owed (or required to be remitted) by Quant (whether or
not shown or required to be shown on any tax return) have been timely paid. No
claim has been made by any governmental body in a jurisdiction where Quant does
not file tax returns that such Quant is or may be subject to the payment,
collection or remittance of any tax of that jurisdiction or is otherwise subject
to taxation by that jurisdiction. There are no Encumbrances of any kind on any
of the assets of Quant in connection with, or otherwise related to, any failure
(or alleged failure) to pay any tax.

 

4.9 Litigation; No Violation. There is no legal or administrative proceeding
pending, threatened or anticipated against Quant. Quant has no knowledge of any
event that has occurred or circumstance that exists that would reasonably be
expected to give rise to or serve as a basis for the commencement of any legal
or administrative proceeding. Quant is not in violation of any applicable laws
including, without limitation, labor, employment, and environmental laws, or in
breach or default of any agreement, document, judgment, injunction, order or
decree binding upon Quant which could reasonably be expected to result in a
material adverse effect on Quant.

 

5. CONFIDENTIALITY

 

5.1 The Parties agree that, in connection with this Agreement, the Parties have
disclosed and intend to further disclose to each other information that is
considered confidential and proprietary or otherwise not generally available to
the public. In order to protect their proprietary, confidential, and otherwise
non-public information, the Parties agree to the following provisions with
respect to confidentiality of information.

 

5.2 As used in this Section 5.2, “Confidential Information” means all nonpublic
information previously disclosed or that will be disclosed by one party, its
affiliates or its or their respective agents (the “Disclosing Party”) to the
other party, its affiliates, or its agents (the “Receiving Party”) that is
designated as confidential or that, given the nature of the information or the
circumstances surrounding its disclosure, reasonably should be considered as
confidential. Confidential Information includes, but is not limited to, whether
or not designated as confidential: (i) nonpublic information relating to the
Disclosing Party’s technology, customers, distributors, business plans,
promotional and marketing activities, finances, and other business affairs, and
(ii) third-party information that the Disclosing Party is obligated to keep
confidential. Confidential Information does not include any information that (w)
is or becomes publicly available without breach of this Section 5, (x) can be
shown by documentation to have been known to the Receiving Party at the time of
its receipt from the Disclosing Party without obligation of confidentiality, (y)
is received from a third party who, to the knowledge of the Receiving Party, did
not acquire or disclose such information by a wrongful or tortious act, or (z)
can be shown by documentation to have been independently developed by the
Receiving Party without reference to any Confidential Information.

  

 -5- 

 

 

EXECUTION COPY

 

5.3 The Receiving Party may use Confidential Information of the Disclosing Party
only in connection with this Agreement. Except as expressly provided in this
Section, the Receiving Party may not disclose Confidential Information to anyone
without the Disclosing Party’s prior written consent. The Receiving Party will
take all reasonable measures to avoid unauthorized disclosure, dissemination, or
use of Confidential Information; and, in any event, such measures will not be
less that the Receiving Party currently employs, if any, to protect its own
confidential information from unauthorized disclosure, dissemination, or use.
The Receiving Party will restrict the possession, knowledge and use of
Confidential Information to its representatives who have a need to know
Confidential Information in connection with this Agreement. Receiving Party must
inform all representatives of the confidential nature of the information, and
all representatives must expressly agree to treat the information as
confidential in accordance with this Section 5. The Receiving Party is fully
responsible for any breach of this Section 5 by its representatives.

 

5.4 The Receiving Party may disclose Confidential Information as required to
comply with binding orders of governmental entities that have jurisdiction over
it, provided that the Receiving Party (i) gives the Disclosing Party reasonable
notice (to the extent permitted by law) to allow the Disclosing Party to seek a
protective order or other appropriate remedy, (ii) discloses only such
information as is required by the governmental entity, and (iii) uses
commercially reasonable efforts to obtain confidential treatment for any
Confidential Information so disclosed.

 

5.5 The Receiving Party acknowledges that disclosure or use of Confidential
Information in violation of this Section 5 could cause irreparable harm to the
Disclosing Party for which monetary damages may be difficult to ascertain or an
inadequate remedy. The Receiving Party agrees that the Disclosing Party has the
right, in addition to its other rights and remedies under this Agreement, to
seek injunctive relief for any threatened or actual violation of this Section 5,
without any requirement to post bond or provide similar security.

 

6. CONDITIONS TO CLOSING

 

6.1 Conditions to Closing. Each Party’s obligation to consummate the
transactions set forth herein will be subject to satisfaction or waiver by the
appropriate Party of each the following conditions on or before the Closing
Date:

 

(a)The contemplated transactions have been approved by each Party’s Board of
Directors.

 

(b)Ominto’s satisfaction with the results of its due diligence review of Quant.

 

(c)The representations and warranties of each Party shall be true and correct as
of the Agreement Date and as of the Closing Date as if made on the Closing Date
(other than representations and warranties that are made as of a specific date,
which representations and warranties shall have been true and correct as of such
date).

 

 -6- 

 

 

EXECUTION COPY

 

7. RIGHT TO PURCHASE SHARES

 

7.1 Ominto shall have the right, but not the obligation, to purchase up to
1,000,000 of the Ominto Shares from Quant as set forth below in one or more
transactions.

 

7.2 Ominto shall have the right commencing on the date that Ominto’s common
stock is listed on NASDAQ (the “Listing Date”) and continuing for six (6) months
thereafter to purchase up to 500,000 of the Ominto Shares from Quant at a
purchase price of six dollars ($6) per share.

 

7.3 Ominto shall have the right commencing on the Listing Date and continuing
for twelve (12) months thereafter to purchase up to 500,000 of the Ominto Shares
from Quant at a purchase price of eight dollars ($8) per share.

 

7.4 Ominto shall notify Quant of its intent to exercise its option in writing
stating the number of shares it desires to purchase and the purchase price for
such shares.

 

7.5 The closing for each such purchase shall occur within ten (10) business days
after such notice is delivered.

 

7.6 The purchase agreement for any such purchase shall include representations
and warranties standard for a transaction of this type including, but not
limited to, warranties related to authority, ownership, and the ability to
convey title to the purchased shares.

 

8. OTHER PROVISIONS

 

8.1 Governing Law. This Agreement will be construed and interpreted according to
the laws of the State of Florida without reference to its conflicts of law
principles and Quant and Ominto consent to exclusive jurisdiction and venue in
the state and federal courts located in and for Palm Beach County, Florida. The
Parties hereby consent to the jurisdiction of such courts and irrevocably waive
any objections thereto, including without limitation, on the basis of improper
venue or forum non conveniens.

 

8.2 Waiver. Any Party may, at its option, waive only by written notice, any and
all of the conditions to which its obligations under this Agreement are subject.
No delay on the part of any Party in the exercise of any right or remedy will
operate as a waiver thereof, and no single or partial exercise of any right or
remedy will preclude other or further exercise thereof or the exercise of any
other right or remedy. All remedies provided herein or otherwise available
(including at law or in equity) will be cumulative. The waiver or
non-enforcement of any breach of any provision of this Agreement will not
operate or be construed as a waiver of any subsequent breach. No waiver will be
legally operative unless in writing and signed by the Party to be bound.

  

 -7- 

 

 

EXECUTION COPY

 

8.3 Attorneys’ Fees. In any suit or action brought to enforce this Agreement,
the exhibits or schedules attached hereto or any other signed instrument
referred to herein, or to obtain an adjudication, declaratory or otherwise, of
rights hereunder or thereunder, the losing Party will pay to the prevailing
Party reasonable attorneys’ fees and all other costs and expenses which may be
incurred by the prevailing Party in such action. In the event that both Parties
prevail, in part, the court will have the discretion to award fees and costs as
it deems equitable.

  

8.4 Amendment and Modifications. The Parties may amend, modify or supplement
this Agreement in such manner as may be agreed upon but only by a written
instrument dated subsequent to the date of this Agreement and signed by the
Parties.

 

8.5 Entire Agreement. This Agreement constitutes the entire agreement among the
undersigned and supersedes all prior agreements and understandings, oral and
written, among the Parties with respect to the subject matter hereof, including
but not limited to that certain Summary of Non-Binding Terms between the Parties
dated May 31, 2016. In case of a conflict between a provision of this Agreement
and a provision of an exhibit or schedule included herein, the provision of this
Agreement will control. The Recitals and all exhibits and schedules to this
Agreement are hereby incorporated into this Agreement as if fully set forth
herein.

 

8.6 Expenses. Except as otherwise provided in this Agreement, the Parties will
pay their respective expenses incurred in connection with the preparation,
execution, and delivery of this Agreement and the consummation of the
transactions contemplated hereby.

 

8.7 Survival. All representations, warranties, covenants, and agreements made by
the Parties in the Agreement will survive the execution and closing of the
transactions contemplated hereby. All provisions which by their nature are meant
to survive closing shall survive closing for the applicable statute of
limitations.

 

8.8 Notices, Etc. All notices, requests, consents, approvals, or authorizations
in connection with this Agreement: (a) must be given in writing; and (b) will be
deemed given as of (i) the day they are delivered on paper by a globally
recognized express delivery service (such as FedEx Express, DHL, or UPS),
addressed as set forth below, or (ii) if delivery is unsuccessful, the first
date such delivery is attempted or refused:

 

If to Quant: Quant Systems, Inc.  

ATTN: Srinivas Veeravelli

600 E John Carpenter Fwy

Suite #375

Irving, TX 75062

  

If to Ominto: Ominto, Inc.  

ATTN: General Counsel

1515 S. Federal Highway, Suite 307

Boca Raton, FL 33432

 

With a copy to: K&L Gates LLP  

ATTN: Clayton Parker

200 South Biscayne Blvd., Suite 3900
Miami, FL 33131

 

Such addresses may be changed, from time to time, by means of a written notice
delivered by the Party seeking to change such address in the manner provided for
in this Section 8.8.

 

 -8- 

 

 

EXECUTION COPY

  

8.9 Service of Process. Each Party which does not have an address in the

 

United States shall appoint an agent for service of process in the United States
and shall provide to the other Party the name and address of such agent upon
execution of this Agreement.

 

8.10 Assignment. This Agreement may not be assigned by either Party without the
prior written consent of the other Party.

 

8.11 Invalidity. The invalidity or unenforceability of any term or provision of
this Agreement or the application of such term or provision to any person or
circumstance will not impair or affect the remainder of this Agreement or its
application to other persons and circumstances, and the remaining terms and
provisions will remain in full force and effect, so long as the economic or
legal substance of the transactions provided for in this Agreement is not
affected in any manner materially adverse to any Party. Upon such determination
that any term or other provision is invalid, illegal, or incapable of being
enforced, the Parties further agree to use good faith efforts to replace such
void and unenforceable provision of this Agreement with a valid and enforceable
provision that will achieve, to the extent possible, the original intent of the
Parties in order that the transactions provided for in this Agreement are
consummated as originally contemplated to the fullest extent possible.

 

8.12 Counterparts. This Agreement may be signed in counterparts, each of which
will be deemed an original and all of which will together constitute one
agreement. Delivery of an executed signature page to this Agreement by a Party
by electronic transmission, including fax or email, will be as effective as
delivery of a manually executed copy of the Agreement by such Party.

 

8.13 Indemnification. From and after the Closing Date, each Party (for purposes
of this Section 8.13, the “Indemnifying Party”) shall indemnify and hold
harmless the other Party (for purposes of this Section 8.13, the “Indemnified
Party”) from and against any and all losses, claims, damages, liabilities,
penalties, judgments, suits, costs and expenses (including reasonable legal fees
and disbursements, which shall be reimbursed periodically as incurred) that are
suffered or incurred by the Indemnified Party arising out of, resulting from, or
relating to any of the following matters:

 

(a) the inaccuracy of any representation or warranty made by the Indemnifying
Party in this Agreement;

 

(b) the inaccuracy of any information provided by the Indemnifying Party as part
of the due diligence process; and

 

(c) the failure by the Indemnifying Party to perform any covenant or agreement
made by the Indemnifying Party in this Agreement.

 

Signature Page Follows

 

 -9- 

 

 

EXECUTION COPY

 

IN WITNESS WHEREOF, the Parties have duly executed this Agreement on the date
first above written.

 

QUANT SYSTEMS INC.

 

By: /s/ Srinivas Veeravelli         Print Name: Srinivas Veeravelli        
Title: CEO  

  

OMINTO, INC.

 

By: /s/ Michael Hansen         Print Name: Michael Hansen         Title: CEO  

 

 

 

 

 

 

 

 

 

Signature Page to Share Exchange Agreement