Exhibit 10.1

 

STOCK Purchase Agreement

 

This Stock Purchase Agreement (the “Agreement”) is made and entered into as of
the March 18, 2020 by XsunX, Inc., a Colorado corporation (“XsunX”), which has a
mailing address of 65 Enterprise, Aliso Viejo, California 92656, Tom Djokovich,
an individual that owns 100% of XsunX’s outstanding Series A Preferred Stock
(“Djokovich” or “Seller”), and TN3, LLC, a Wyoming limited liability company
(the “Buyer” or “Company”), with respect to the following facts:

 

R E C I T A L S

 

 

A.

Seller owns 5,000 shares of XsunX’s outstanding Series A Preferred Stock, which
represents 100% of the total issued and outstanding shares of Series A Preferred
Stock of XsunX (the “XsunX Stock”).

 

 

B.

The XsunX Stock represents the number of votes equal to the number of voting
common shares representing not less than 60% of the total outstanding vote,
which may be applied toward approval or disapproval of any action that Colorado
law provides is subject to the vote or consent of the holders of any other
series of voting preferred shares, the holders of voting common shares, and the
holders of other securities entitled to vote, if any.

 

 

C.

XsunX is engaged in the business of selling, designing, and installing solar
photovoltaic power generation, energy storage in the form of managed battery
systems, and energy use management technologies (“XsunX Business”). Under this
Agreement, XsunX will acquire a new business owned by an affiliate of the Buyer
known as Innovest Global, Inc. (“Innovest”), and thereafter will cease to
conduct the XsunX Business. Seller will resign as an officer and director of
XsunX upon the closing of the transactions contemplated by this Agreement.

 

 

D.

StemVax LLC, a subsidiary of Innovest and an affiliate of the Buyer, is a unique
technology company in the biotechnology, medical and health & wellness markets,
commercializing developmental healthcare solutions. It is currently developing a
third-generation brain cancer vaccine the technology for which has been patent
approved and is known as StemVax Glioblast (SVX-GB) (the “StemVax Business”).
XsunX believes that the StemVax Business includes valuable proprietary
technology that has the potential to enable XsunX shareholders to eventually
earn substantial profits on their investment in XsunX, although no profit is
guaranteed. XsunX believes that the profit potential from the StemVax Business
is substantially greater than from the current XsunX Business.

 

 

E.

In order to facilitate the opportunity for XsunX to acquire the StemVax
Business, the Buyer desires to acquire from Seller and Seller desires to sell to
the Buyer 100% of the total issued and outstanding shares of Series A Preferred
Stock of XsunX in exchange for $50,000 in cash, payable by the Buyer.

 

 

F.

At the Closing of this Agreement, as defined in Section 4 herein, XsunX will
also issue to each of the current directors of XsunX 500,000,000 XsunX stock
purchase warrants (the “Director Warrants”) on a pre-reverse Stock Split basis,
as consideration for their past service to XsunX. A copy of the form of Director
Warrant is attached to this Agreement as Exhibit B.

 

NOW, THEREFORE, for good and valuable consideration the receipt and sufficiency
of which are hereby acknowledged by the parties to this Agreement, and in light
of the above recitals to this Agreement, the parties to this Agreement hereby
agree as follows:

 

1.

Sale and Purchase.

 

1.1     Sale and Purchase of Stock. In consideration for the Purchase Price (as
defined in Section 1.2 of this Agreement) and the other covenants of the Buyer
in this Agreement, Seller agrees to sell to the Buyer, and the Buyer agrees to
purchase from Seller, on the Closing Date (as defined in Section 4.1 of this
Agreement), 5,000 shares of the Series A Preferred Stock of XsunX, representing
100% of the total issued and outstanding shares of Series A Preferred Stock of
XsunX (the “XsunX Stock”). The XsunX Stock represents that number of votes equal
to not less than 60% of

 

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the total outstanding vote, which may be applied toward approval or disapproval
of any action that Colorado law provides may or must be subject to the vote or
consent of the holders of any other series of voting preferred shares, the
holders of voting common shares, and the holders of other securities entitled to
vote, if any. The XsunX Stock is, and will be on the Closing Date, free and
clear of all liens, encumbrances, charges and assessments of every nature.

 

1.2     Purchase Price. As consideration for the sale by Seller of the shares of
XsunX Stock to the Buyer on the Closing Date, the Buyer will pay to Seller
$50,000 in cash (the “Purchase Price”).

 

2.

Issue of Director Warrants.

 

As consideration to the current XsunX directors for their past services to XsunX
and the XsunX Business, XsunX will, at the Closing, issue to each of the current
resigning directors of XsunX 500,000,000 common stock purchase warrants (the
“Director Warrants”) to purchase up to 500,000,000 shares of XsunX common stock
on a pre-Stock Split (as defined in Section 4.4 of this Agreement) basis
(500,000 shares post-Stock Split). The Director Warrants will be exercisable on
a cashless basis for a period of ten years from the effective date of the Stock
Split at an exercise price of $0.00001 per share on a pre-Stock Split basis
($0.01 per share post-Stock Split), and will substantially be in the Form of
Warrant attached hereto as Exhibit B.

 

3.

Covenants.

 

3.1     XsunX Board of Directors. At or prior to the Closing, to be effective on
the Closing Date, the parties will execute all documents, resolutions,
resignations, appointments, and acceptances in order to cause the XsunX Board of
Directors to consist of Dan Martin. The resigning directors will each receive
the Director Warrants. Prior to the Closing, to be effective on or before the
Closing, Seller will cause XsunX to file with the SEC a Schedule 14F to disclose
the change of management, and Buyer will cooperate and assist XsunX with such
Schedule 14F filing.

 

3.2     XsunX Officers. At or prior to the Closing, to be effective on the
Closing Date, the parties will execute all documents, resolutions, resignations,
appointments and acceptances in order to cause the executive officers of XsunX
to be as designated in writing by the Buyer; provided, that Dan Martin will be a
director and the Chief Executive Officer of XsunX.

 

3.3     Change of Business. On and promptly after the Closing, with the
assistance of Seller under the terms of an Officer Transition Agreement with
XsunX (the “Officer Transition Agreement”), Buyer and Seller will prepare XsunX
for the cessation of the XsunX Business upon the acquisition of the StemVax
Business. Thereafter, Buyer will cause XsunX to conduct the StemVax Business for
profit in a high quality professional manner. In order to accomplish the
acquisition of the StemVax Business, as soon as reasonably possible after the
Closing Date, but in no event more than 90 days after the Closing Date, the
Buyer covenants to cause XsunX and Innovest to enter into a legally binding
acquisition agreement for that purpose in substantially the form membership
interest purchase agreement attached as Exhibit D (the “StemVax Purchase
Agreement”), to prepare and complete the Stock Split, as defined below, and
complete a name change of XsunX to “NovAccess Inc.” (the “Name Change”).

 

4.

Closing and Further Acts.

 

4.1     Time and Place of Closing. Upon satisfaction or waiver of the conditions
set forth in Section 7 of this Agreement, the closing of the transactions
contemplated by this Agreement (the “Closing”) will take place at 65 Enterprise,
Aliso Viejo, California 92656, or such other location as the parties agree, at
11:00 a.m. (local time) on the date the regulatory requirements of the SEC and
FINRA, and otherwise for the actions referenced in Section 4.2 of this
Agreement, are satisfied, but in no event later than May 29, 2020 (the “Closing
Date”), unless extended by mutual written agreement of the parties.

 

4.2     Actions at Closing. At the Closing, the following actions will take
place:

 

(a)     Buyer will pay to Seller the Purchase Price by delivery of a cashier’s
check for the Purchase Price.

 

(b)     XsunX new Board of Directors will issue warrants to purchase XsunX
common stock to the current directors of XsunX evidencing the Director Warrants.

 

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(c)     Seller will tender to the Buyer certificates and any other documents
(including all historical records relating to the certificates up to the Closing
Date) evidencing the XsunX Stock, duly endorsed for transfer to Buyer.

 

(d)     XsunX will deliver to Buyer copies of necessary resolutions of the Board
of Directors of XsunX authorizing the execution, delivery, and performance of
this Agreement, and the other agreements contemplated by this Agreement, and
confirming the continued validity and enforceability of the Series A Preferred
Stock of XsunX in the name of its new holder after the Closing, which
resolutions have been certified by an officer of XsunX as being valid and in
full force and effect.

 

(e)     Buyer will deliver to Seller copies of resolutions of the Manager of
Buyer authorizing the execution, delivery and performance this Agreement, and
the other agreements contemplated by this Agreement, which resolutions have been
certified by an officer of Buyer as being valid and in full force and effect.
Buyer will deliver to Seller copies of resolutions of the board of directors of
Innovest authorizing the execution, delivery and performance the StemVax
Purchase Agreement, which resolutions have been certified by an officer of
Innovest as being valid and in full force and effect.

 

(f)     XsunX will deliver to the Buyer true and complete copies of XsunX’s
Articles of Incorporation and a Certificate of Good Standing from the
appropriate official of XsunX’s jurisdiction of incorporation, which
certificates and certificates of good standing are dated not more than 30 days
prior to the Closing Date.

 

(g)     Delivery of appropriate resignations, appointments, acceptances and
resolutions relating to the new and resigning members of the XsunX Board of
Directors and XsunX officers as contemplated in Sections 3.1 and 3.2 of this
Agreement.

 

(h)     XsunX new management and Seller will execute an Officer Transition
Agreement.

 

(i)     XsunX new management and a wholly owned contracting services entity of
Seller will execute the Transition Services Agreement.

 

(j)     Delivery of any additional documents or instruments as a party may
reasonably request or as may be necessary to evidence and effect the sale,
assignment, transfer and delivery of the issued and outstanding XsunX Stock to
the Buyer.

 

4.3      Buyer’s Authority Post Closing. After the Closing the Buyer will have
the following authority: (i) management of XsunX; (ii) all XsunX funding
requirements; and (iii) receive all records and documents relating to XsunX for
review and control by the Buyer.

 

4.4     Reverse Stock Split and Name Change. As soon as reasonably possible
after the Closing Date, but in no event more than 90 days after the Closing
Date, Buyer will cause XsunX to execute all documents and take all action which
are necessary or appropriate in order to cause XsunX to amend its Articles of
Incorporation in order to effect a 1-for-1,000 reverse stock split of XsunX’s
issued and outstanding common stock (the “Stock Split”), including but not
limited to executing and recording Articles of Amendment with the Colorado
Secretary of State upon satisfaction by XsunX of all applicable filing and
notification requirements of the Securities and Exchange Commission (“SEC”) and
the Financial Industry Regulatory Authority (“FINRA”). Buyer will cause XsunX to
prepare and file with the SEC or FINRA, as the case may be, the following
documents to effect the transactions contemplated by this Agreement: (i)
Schedule 14C covering Buyer’s actions to authorize and direct the Stock Split
and Name Change; and (ii) required notice to FINRA. Buyer will effectuate the
Stock Split and Name Change before XsunX acquires the StemVax Business as
provided for in Section 3.3 above.

 

4.5     Business Transition. In order to facilitate XsunX ceasing the XsunX
Business and transition to the StemVax Business, XsunX will enter into a
Transition Services Agreement with Seller in which Seller may accept
responsibility for new or current contracts offered or initially entered into by
XsunX with Seller as the qualifying

 

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individual for the XsunX license, assume related current and future contract
service commitments, retain the current and future contract revenue and related
net profits, if any, from those contracts, and generally engage in the delivery
of the contracts to ensure contract completion on a case by case basis (the
“Transition Services Agreement”). At the completion of the acquisition of the
StemVax Business Seller will withdraw his position as the qualifying individual
for the XsunX contractor license for the XsunX Business, and upon completion of
the withdrawal XsunX and Seller will terminate the Transition Services
Agreement. Thereafter, Seller may accept contracts initially marketed by XsunX
with Seller as the qualifying individual for the XsunX license, without
obligation to XsunX for any cash flows therefrom. The timing and procedures for
the transition of the XsunX Business is governed by that certain Transition
Services Agreement attached to this Agreement as Exhibit C, by and between
XsunX, Seller and a wholly owned contracting services entity of Seller. In the
event of any contradiction or discrepancy between this Agreement and the
Transition Services Agreement, the terms and provisions of the Transition
Services Agreement will govern.

 

5.

Representations and Warranties of XsunX and Seller.

 

XsunX and Seller represent and warrant to Buyer as follows:

 

5.1     Power and Authority; Binding Nature of Agreement. XsunX and Seller have
full power and authority to enter into this Agreement and to perform their
obligations hereunder. The execution, delivery, and performance of this
Agreement by XsunX have been duly authorized by all necessary action on its
part. Assuming that this Agreement is a valid and binding obligation of each of
the other parties hereto, this Agreement is a valid and binding obligation of
XsunX and Seller. The transfer of the XsunX Stock by Seller to Buyer pursuant to
this Agreement has been duly authorized and approved by the XsunX Board of
Directors, and the XsunX Stock will remain outstanding and in full force and
effect at the Closing with the Buyer as its owner.

 

5.2     Subsidiaries. There is no corporation, general partnership limited
partnership, joint venture, association, trust or other entity or organization
that XsunX directly or indirectly controls or in which XsunX directly or
indirectly owns any equity or other interest.

 

5.3     Good Standing. XsunX (i) is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated, (ii)
has all necessary power and authority to own its assets and to conduct its
business as it is currently being conducted, and (iii) to its knowledge, is duly
qualified or licensed to do business and is in good standing in every
jurisdiction (both domestic and foreign) where such qualification or licensing
is required.

 

5.4     Charter Documents and Corporate Records. XsunX has delivered to Buyer
complete and correct copies or provided Buyer with the right to inspect true and
complete copies of all (i) the articles of incorporation, bylaws and other
charter or organizational documents of XsunX, including all amendments thereto,
and (ii) the stock records of XsunX. XsunX is not in violation or breach of any
of the provisions of its articles of incorporation, bylaws or other charter or
organizational documents.

 

5.5     Financial Statements; SEC Filings.

 

(a)      XsunX has delivered to Buyer (by public filing with or furnishing to
the SEC or otherwise) the following financial statements relating to XsunX prior
to the Closing (the “XsunX Financial Statements”): (i) the audited balance sheet
of XsunX as of September 30, 2019 and 2018, and (ii) the audited statements of
income for the years ended September 30, 2019 and 2018. Except as stated therein
or in the notes thereto, the XsunX Financial Statements: (a) present fairly the
financial position of XsunX as of the respective dates thereof and the results
of operations and changes in financial position of XsunX for the respective
periods covered thereby; and (b) have been prepared in accordance with XsunX’s
normal business practices applied on a consistent basis throughout the periods
covered.

 

(b)      XsunX and Seller have made available to Buyer (by public filing with or
furnishing to the SEC or otherwise) a true and complete copy of each report,
schedule, registration statement and definitive proxy statement filed or
furnished by XsunX with the SEC since January 1, 2016 (the “XsunX SEC
Documents”). As of their respective dates, the XsunX SEC Documents (other than
preliminary materials) complied in all material respects with the requirements
of the Securities Act of 1933 or the Securities Exchange

 

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Act of 1934, as the case may be, and the rules and regulations of the SEC
thereunder applicable to such XsunX SEC Documents and none of the XsunX SEC
Documents, at the time of filing with the SEC or being furnished to the SEC (or
effectiveness in the case of registration statements), contained any 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, except to the extent
such statements have been modified or superseded by later XsunX SEC Documents
filed or furnished and publicly available prior to the date of this Agreement.
As of the date of this Agreement and except as previously made available to
Buyer, XsunX does not have any outstanding and unresolved comments from the SEC
with respect to the XsunX SEC Documents. No subsidiary of XsunX is required to
file any form or report with the SEC.

 

(c)     XsunX has made available to Buyer true, complete and correct copies of
all written correspondence between the SEC on the one hand, and XsunX, on the
other hand, since January 1, 2016. At all applicable times, XsunX has to its
knowledge complied in all material respects with the applicable provisions of
the Sarbanes-Oxley Act of 2002 and any applicable rules and regulations
thereunder, as amended from time to time, and the applicable listing and
corporate governance rules of the principal securities market on which the
Common Stock of XsunX is traded as of the date hereof.

 

5.6     Capitalization. The authorized capital stock of XsunX consists of
2,000,000,000 shares of common stock, par value $0.01 per share, of which
approximately 1,601,887,744 shares are issued and outstanding as of December 31,
2019, and 50,000,000 shares of preferred stock, par value $0.01 per share, of
which 10,000 shares have been designated as Series A Preferred Stock, 5,000 of
which are issued and outstanding. All of the outstanding shares of the capital
stock of XsunX are validly issued, fully paid and nonassessable, and have been
issued in full compliance with all applicable federal, state, local and foreign
securities laws and other laws.

 

5.7     Absence of Changes. Except as otherwise set forth on Schedule 5.7
hereto, since September 30, 2019, there has not been any material adverse change
in the business, condition, assets, operations or prospects of XsunX and no
event has occurred or, to XsunX’s knowledge, is expected to occur after the
Closing that might have a material adverse effect on the business, condition,
assets, operations or prospects of XsunX, other than the transfer to Seller by
XsunX of all contractual obligations and related rights for the delivery of
services, materials, warranty obligations, and delivery costs pertaining to
contracts that are, as of the date of this Agreement, a work in progress or in
the process of fulfillment or delivery, or that have been completed at the time
of the Closing, or which have been entered into after the date of this
Agreement, including without limitation the right to cash flow from those
contracts.

 

5.8     Absence of Undisclosed Liabilities. XsunX has no debt, liability or
other obligation of any nature (whether due or to become due and whether
absolute, accrued, contingent or otherwise) that is not reflected or reserved
against in the XsunX Financial Statements as of September 30, 2019, except for
obligations incurred since September 30, 2019 in the ordinary and usual course
of business consistent with past practice.

 

5.9     Corporation Status. XsunX is identified as a “C” corporation prior to
Closing.

 

5.10     Conflict of Interest Transactions. Except as may be disclosed in the
XsunX SEC Documents, no past or present shareholder, director, officer or
employee of XsunX or any of their affiliates (i) is indebted to, or has any
outside financial, business or contractual relationship or arrangement with
XsunX, or (ii) has any direct or indirect interest in any property, asset or
right which is owned or used by XsunX or pertains to the of XsunX Business.

 

5.11     Litigation. Except as may be disclosed in the XsunX SEC Documents,
there is no actual action, suit, proceeding, dispute, litigation, claim,
complaint or investigation by or before any court, tribunal, governmental body,
governmental agency or arbitrator pending or, to XsunX’s knowledge, threatened
against or with respect to XsunX which (i) if adversely determined would have a
material adverse effect on the business, condition, assets, operations or
prospects of XsunX, or (ii) challenges or would challenge any of the actions
required to be taken by XsunX under this Agreement. To XsunX’s knowledge, there
exists no basis for any such action, suit, proceeding, dispute, litigation,
claim, complaint or investigation.

 

5.12     Approvals. XsunX has provided Buyer with a complete and accurate list
of all jurisdictions in which XsunX is authorized to do business, including any
required authorization, consent or approval of, or registration or

 

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filing with, any governmental authority that is required to be obtained or made
by XsunX in connection with the execution, delivery or performance of this
Agreement, including the conveyance to Buyer of the XsunX Stock.

 

5.13     Brokers. XsunX has not agreed to pay any brokerage fees, finder’s fees
or other fees or commissions with respect to the transactions contemplated by
this Agreement, and, to XsunX’s knowledge, no person is entitled, or intends to
claim that it is entitled, to receive any such fees or commissions in connection
with such transaction.

 

5.14     Representations True on Closing Date. The representations and
warranties of XsunX set forth in this Agreement are true and correct on the date
hereof, and will be true and correct on the Closing Date as though such
representations and warranties were made as of the Closing Date. Buyer’s
knowledge will not act as a waiver of any breach of the representations and
warranties contained herein by XsunX or Seller.

 

5.15     Tax Advice. XsunX and Seller hereby represent and warrant that they
have sought their own independent tax advice regarding the transactions
contemplated by this Agreement and neither XsunX nor Seller have relied on any
representation or statement made by Buyer or its representatives regarding the
tax implications of such transactions.

 

5.16     Non-Contravention. To the Seller’s knowledge, neither the execution nor
delivery of this Agreement, nor the performance of this Agreement will
contravene or result in a material violation of any of the provisions of any
other agreement or obligation of the Seller or XsunX.

 

6.

Representations and Warranties of Buyer.

 

Buyer represents and warrants to XsunX and Seller as follows:

 

6.1     Power and Authority; Binding Nature of Agreement. Buyer has full power
and authority to enter into this Agreement and to perform its obligations
hereunder. The execution, delivery and performance of this Agreement by Buyer
have been duly authorized by all necessary action on its part. Assuming that
this Agreement is a valid and binding obligation of the other party hereto, this
Agreement is a valid and binding obligation of Buyer.

 

6.2     Approvals. To Buyer’s knowledge, no authorization, consent or approval
of, or registration or filing with, any governmental authority or any other
person is required to be obtained or made by Buyer in connection with the
execution, delivery or performance of this Agreement.

 

6.3     Representations True on Closing Date. To the Buyer’s knowledge, the
representations and warranties of Buyer set forth in this Agreement are true and
correct on the date hereof, and will be true and correct on the Closing Date as
though such representations and warranties were made as of the Closing Date.

 

6.4     Non-Distributive Intent. The shares of XsunX Stock being purchased by
the Buyer pursuant to this Agreement are not being acquired by the Buyer with a
view to the public distribution or sale of them.

 

6.5     Non-Contravention. To the Buyer’s knowledge, neither the execution nor
delivery of this Agreement, nor the performance of this Agreement will
contravene or result in a material violation of any of the provisions of any
other agreement or obligation of the Buyer.

 

6.6     Buyer is an Accredited Investor. The Buyer is (i) an "accredited
investor" as that term is defined in Rule 501 of the Act, and (ii) experienced
in making investments of the kind described in this Agreement and the related
documents, and (iii) able, by reason of the business and financial experience of
its officers (if an entity) and professional advisors (who are not affiliated
with or compensated in any way by the Seller or any of its affiliates or selling
agents), to protect its own interests in connection with the transactions
described in this Agreement and the related documents.

 

6.7     Certificate of Designation. The Buyer has reviewed the Certificate of
Designation of XsunX for the Series A Preferred Stock, which is attached hereto
as Exhibit A, and is satisfied with it.

 

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7.

Conditions to Closing.

 

7.1     Conditions Precedent to Buyer’s Obligation to Close. Buyer’s obligation
to close the stock purchase as contemplated in this Agreement is conditioned
upon the occurrence or waiver by Buyer of the following:

 

(a)     Seller shall have delivered to the Buyer all certificates evidencing the
XsunX Stock and ownership of 100% of the issued and outstanding Series A
Preferred Stock of XsunX.

 

(b)     All representations and warranties of XsunX and Seller made in this
Agreement or in any exhibit or schedule hereto delivered by XsunX and Seller
must be true and correct as of the Closing Date with the same force and effect
as if made on and as of that date.

 

(c)     XsunX must have performed and complied with all agreements, covenants
and conditions required by this Agreement to be performed or complied with by
XsunX prior to or at the Closing Date.

 

7.2     Conditions Precedent to Seller’s and XsunX’s Obligation to Close.
Seller’s and XsunX’s obligation to close the stock purchase as contemplated in
this Agreement is conditioned upon the occurrence or waiver by Seller and XsunX
of the following:

 

(a)     Buyer shall have delivered to Seller or his designees the Purchase
Price.

 

(b)     XsunX shall have delivered the Director Warrants to the resigning
directors of XsunX.

 

(c)     All representations and warranties of Buyer made in this Agreement or in
any exhibit hereto delivered by Buyer must be true and correct on and as of the
Closing Date with the same force and effect as if made on and as of that date.

 

(d)     Buyer must have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with by Buyer
prior to or at the Closing Date.

 

(e)     Execution and delivery of a Transition Services Agreement between XsunX
and the wholly owned contracting services entity of Seller.

 

(f)     Execution and delivery of an Officer Transition Agreement between XsunX
and Seller.

 

(g)     Execution and delivery of the StemVax acquisition Agreement by and
between XsunX and Innovest with resolutions of the Board of Directors of the
Manager of Buyer and of Innovest authorizing the execution.

 

(h)      Buyer shall have advanced payment in cash to Seller and XsunX for any
remaining Pre and authorized Post Agreement Transaction costs, as described for
in Section 12 below, at least five (5) business days prior to the Closing.

 

8.

Survival of Representations and Warranties.

 

All representations and warranties made by each of the parties hereto will
survive the Closing for a period after the Closing Date equal to the applicable
statute of limitations for such matters under applicable state law.

 

9.

Indemnification.

 

(a)      Buyer agrees to indemnify, defend and hold harmless Seller against any
and all claims, demands, losses, costs, expenses, obligations, liabilities and
damages, including interest, penalties and attorneys’ fees and costs incurred by
Seller, arising, resulting from or relating to any breach of, or failure by
Buyer to perform, any of its representations, warranties, covenants or
agreements in this Agreement or in any exhibit or other document furnished or to
be furnished by Buyer under this Agreement.

 

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(b)      XsunX agrees to indemnify, defend and hold harmless Buyer against any
and all claims, demands, losses, costs, expenses, obligations, liabilities and
damages, including interest, penalties and attorneys’ fees and costs incurred by
Buyer, arising, resulting from or relating to any breach of, or failure by XsunX
or Seller to perform, any of their representations, warranties, covenants or
agreements in this Agreement or in any exhibit or other document furnished or to
be furnished by Buyer under this Agreement.

 

(c)      Seller agrees to indemnify, defend and hold harmless Buyer against any
and all claims, demands, losses, costs, expenses, obligations, liabilities and
damages, including interest, penalties and attorneys’ fees and costs incurred by
Buyer, arising, resulting from or relating to any failure by Seller to convey
the XsunX Stock to Buyer free and clear of all liens, encumbrances and charges.

 

10.

Injunctive Relief.

 

10.1     Damages Inadequate. Each party acknowledges that it would be impossible
to measure in money the damages to the other party if there is a failure to
comply with any covenants and provisions of this Agreement, and agrees that in
the event of any breach of any covenant or provision, the other party to this
Agreement will not have an adequate remedy at law.

 

10.2     Injunctive Relief. It is therefore agreed that the other party to this
Agreement who is entitled to the benefit of the covenants and provisions of this
Agreement which have been breached, in addition to any other rights or remedies
which they may have, will be entitled to immediate injunctive relief to enforce
such covenants and provisions, and that in the event that any such action or
proceeding is brought in equity to enforce them, the defaulting or breaching
party will not urge a defense that there is an adequate remedy at law.

 

11.

Further Assurances.

 

Following the Closing, Seller shall furnish to Buyer such instruments and other
documents as Buyer may reasonably request for the purpose of carrying out or
evidencing the transactions contemplated hereby.

 

12.

Fees and Expenses.

 

Transaction costs shall include, without limitation, the reimbursement by Buyer
to XsunX of audit fees associated with XsunX’s 2019 annual audit and first
period quarterly report up to $33,521, and all fees, costs and expenses of
XsunX’s counsel incurred by the Seller or XsunX in connection with the
negotiation and preparation of this Agreement up to $20,000 (collectively,
“Pre-Agreement Execution Transaction Costs”, and upon execution of this
Agreement in carrying out the transactions contemplated hereby all applicable
filing and notification requirements of the SEC and FINRA, including required
quarterly reporting costs (collectively, “Post-Agreement Execution Transaction
Costs”). All Post-Agreement Execution Transaction Costs will be borne by the
Buyer, and Innovest, as appropriate, provided, however, that in no event shall
Buyer or Innovest be responsible for Seller’s or XsunX’s Post-Agreement
Execution Transaction Costs in excess of $5,000 without having first approved
such Transaction Costs in writing (the “Transaction Cost Cap”). Subject to the
Transaction Cost Cap, all Transaction Costs incurred by XsunX will be paid by
Buyer or Innovest within five (5) business days of receipt of invoice by Buyer
from XsunX, provided, however, that XsunX shall present to Buyer costs related
to the preparation and filing of the documents related to, and necessary for,
the Closing to occur, and Buyer and Innovest may elect to pay for those costs
directly, select, other than XsunX council, their own vendor for the
provisioning of the services, or approve the proposed XsunX vendor and costs and
forward such approved expenses to XsunX for payment. Upon the execution of this
Agreement by all parties hereto, the Buyer will deposit $20,000 in cash with
XsunX to be used toward payment of Pre-Agreement Execution Transaction Costs.

 

13.

Waivers.

 

If any party at any time waives any rights hereunder resulting from any breach
by the other party of any of the provisions of this Agreement, such waiver is
not to be construed as a continuing waiver of other breaches of the same or
other provisions of this Agreement. Resort to any remedies referred to herein
will not be construed as a waiver of any other rights and remedies to which such
party is entitled under this Agreement or otherwise.

 

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14.

Successors and Assigns.

 

Each covenant and representation of this Agreement will inure to the benefit of
and be binding upon each of the parties, their personal representatives, assigns
and other successors in interest.

 

15.

Entire and Sole Agreement.

 

This Agreement constitutes the entire agreement between the parties and
supersedes all other agreements, representations, warranties, statements,
promises and undertakings, whether oral or written, with respect to the subject
matter of this Agreement. This Agreement may be modified or amended only by a
written agreement signed by the parties against whom the amendment is sought to
be enforced. The parties acknowledge that as of the date of the execution of
this Agreement, that any and all other agreements either written or verbal will
be terminated and be of no further force or effect.

 

16.

Governing Law.

 

This Agreement will be governed by the laws of Colorado without giving effect to
applicable conflict of law provisions. With respect to any litigation arising
out of or relating to this Agreement, each party agrees that it will be filed in
and heard by the state or federal courts with jurisdiction to hear such suits
located in Orange County, California.

 

17.

Counterparts.

 

This Agreement may be executed simultaneously in any number of counterparts,
each of which counterparts will be deemed to be an original, and such
counterparts will constitute but one and the same instrument.

 

18.

Assignment.

 

Except in the case of an affiliate of the Buyer, this Agreement may not be
assignable by any party without prior written consent of the other parties.

 

19.

Remedies.

 

Except as otherwise expressly provided herein, none of the remedies set forth in
this Agreement are intended to be exclusive, and each party will have all other
remedies now or hereafter existing at law, in equity, by statute or otherwise.
The election of any one or more remedies will not constitute a waiver of the
right to pursue other available remedies.

 

20.

Section Headings.

 

The section headings in this Agreement are included for convenience only, are
not a part of this Agreement and will not be used in construing it.

 

21.

Severability.

 

In the event that any provision or any part of this Agreement is held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability will not affect the validity or enforceability of any other
provision or part of this Agreement.

 

22.

Notices.

 

Each notice or other communication hereunder must be in writing and will be
deemed to have been duly given on the earlier of (i) the date on which such
notice or other communication is actually received by the intended recipient
thereof, or (ii) the date five (5) days after the date such notice or other
communication is mailed by registered or certified mail (postage prepaid) to the
intended recipient at the following address (or at such other address as the
intended recipient will have specified in a written notice given to the other
parties hereto):

 

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If to XsunX and Seller

 

XsunX, Inc.

65 Enterprise

Aliso Viejo, California 92656

Attn: Tom Djokovich, Chief Executive Officer

 

Telephone:

Email:

 

If to Buyer:

 

TN3 LLC

8834 Mayfield Road

Chesterland, Ohio 44026

Attention: Dan Martin, Managing Member

Telephone:

Email:

 

23.

Publicity.

 

Except as may be required in order for a party to comply with applicable laws,
rules, or regulations or to enable a party to comply with this Agreement, or
necessary for the Buyer to prepare and disseminate any private or public
placements of its securities or to communicate with its shareholders, no press
release, notice to any third party or other publicity concerning the
transactions contemplated by this Agreement will be issued, given or otherwise
disseminated without the prior approval of each of the parties hereto; provided,
however, that such approval will not be unreasonably withheld.

 

 

IN WITNESS WHEREOF, this Agreement has been entered into as of the date first
above written.

 

 

XsunX:

XsunX, Inc., a Colorado corporation

          By:                                                                  
             Tom Djokovich, Chief Executive Officer         Seller:            
                                                                             
Tom Djokovich         Company/Buyer: TN3 LLC, a Wyoming limited liability
company           By:                                                          
                     Dan Martin, Managing Member

 

 

 

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